A 'Comfort Blanket' of Buying; Large Caps Attract More Interest

au.investing.com/analysis/a-comfort-blanket-of-buying-large-caps-attract-more-interest-200536970

By Declan Fallon | Nov 23, 2022 19:37

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Yesterday was the kind of day which doesn't show up in many scans, but it was one where bulls hold the advantage. Bullish accumulation further confirmed the positive nature of yesterday's action. Any gain today would be enough to clear what for many indices, is a 'bull flag'.

The Nasdaq finished with a bullish engulfing pattern on higher volume accumulation which also saw a 'buy' trigger in On-Balance-Volume. Technicals are net bullish with the index sitting just above its 50-day MA.

COMPQ Daily Chart

The S&P staged a breakout as it cleared its 'bull flag' - it remains on course to test its 200-day MA before the week is out. Technicals are net positive and the only disappointment was the light volume to accompany the flag breakout.

SPX Daily Chart

And for the Dow Jones, a similar move almost delivered a new 52-week high.

INDU Daily Chart

Only the Russell 2000 was a little disappointing as it navigates the squeeze between its 20-day and 200-day MAs; it did manage to close above its 200-day MA but it needs something more to break the sequence of mixed signal candlesticks.

IWM Daily Chart

We do need to see some form of buying if yesterday's action is to deliver on its premise. Ideally, yesterday closed with solid, white candlesticks - enough to break the pattern of easing we have seen over the last couple of days. What we don't want is an undercut of yesterday's lows as this would likely cause greater panic (effectively, a confirmation failure of a bullish setup). Fingers crossed...

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Last year’s stock market decline was punishing and no one was hit harder that tech and growth stocks — and leadership groups like the Semiconductors. What leads the way up often...

S&P 500 Breaks Out Following Nasdaq, Russell 2000 By Declan Fallon - Feb 02, 2023

Buyers returned after the brief visit of potential bull traps across indices. Yesterday's action delivered the breakouts and today's should be the icing on the cake. The one index...

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A 'Comfort Blanket' of Buying; Large Caps Attract More Interest

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