Friday, March 04, 2011

Stock Indices Close The Week Above Key Moving Averages


A few days ago it was looking as if the bears were about to take control of the  stock market due to the heavy volume I was seeing on the down days but by the close of the week stocks held firm above technical support. All of the major indices ( Dow, S&P500 NASDAQ and Russell2000) held their 50 day moving averages which has supported previous declines over the past few months.

Above is a daily chart of the Ruseell2000 along with its relative strength line in the lower panel. As you can see, the Russell 2000 has made a small symmetrical triangle which is supported by the 50 day moving average. In the lower panel we see the ratio line is breaking out to a new high which indicates strength in the small cap stocks compared to the S&P500. A move above Thursday's high may trigger another leg up for the stock market and if that does indeed happen, the small cap stocks may very well lead the charge!

No comments:

DISCLAIMER

This site may include market analysis. All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Trading and investing involves high levels of risk. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise.
 
Google
Technorati Profile Finance Blogs - Blog Top Sites