May 14, 2008 Stock Market Recap
We saw sellers defend the 200-day moving averages (and other resistance levels) again today. I don’t know what caused the afternoon selling but it wouldn’t surprise me if it was related to options expiration.
The Nasdaq spent a good part of the day hovering right around its 200 DMA before popping several points above it. But that turned out to be a head-fake when selling kicked in at 2:00. The result was a shooting star candlestick that closed beneath two important levels — the nice round number of 2,500 and the 200 DMA. As I noted in the chart, today will go down as an up day on higher volume but the real volume surge was due to late-day selling.
The S&P failed today near last week’s highs. The index has spent this month coiling between resistance around 1422 and its March trendline, which is quickly rising toward 1422. So I continue to watch for one of those lines to break.
The Russell 2000 also had shooting star-like action today and actually closed down on the day.
The Dow peaked just shy of 13,000 and its 200-day moving average today. This is its fifth run at the 200 DMA this month.
No changes
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Primary | Down | Down | Down |
| Intermediate | Up | Up | Up |
| Short-term | Up(+) | Up(+) | Up(+) |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I’m simply using the indices’ relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
Post from: Trader Mike's Blog
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