Market Analysis and Summary
Except for the Russell 2000, which reclaimed its long-term 200-DMA yesterday, the major indexes continued to consolidate constructively around their 50-DMA’s. Meanwhile, leading growth stocks continued to build constructive bases and break out on big volume. As long as the market’s leadership continues to act constructively, we will likely see the market indexes ultimately resume their up trends.
Continue to build long positions as entry point present themselves, however, slowly and with the utmost selectivity. As always, remember that “buying right” is critical, especially when the general market starts to whip around and you’re trying not to get shaken out of a big leader. Don’t buy a stock more than 1-2% past its pivot point and make a habit of eliminating laggards and taking at least partial profits on extended names.
The NASDAQ shook out below its 50-DMA, but finished back above and near its high for the day as volume expanded, which is considered a constructive day of accumulation.
The Russell 2000 gapped down at the open, but found its lows in about 45 minutes and rallied into the close, ending the session near its high for the day and back above its 200-DMA as volume expanded.
The S&P 500 rose 0.08% and closed near its high for the day, although volume on the NSYE declined and it finished the session below its 50-DMA, however slightly.
The DOW gapped down at the open, but found support at its 50-DMA, bounced and closed near its high for the day as volume declined.