U.S. Indexes Show Promise After Testing Moving Average Support
Declan Fallon | Mar 06, 2023 18:30
Last week, Friday picked up on Thursday's gains to push back on the support break. There hasn't been a challenge on earlier bull flags resistance, but we will likely see how much resistance there is at these levels early this week. h2 NASDAQ/h2
In the case of the NASDAQ Composite, a successful test of the 200-day MA came with a new On-Balance-Volume 'buy' trigger. However, there is no pending MACD trigger 'buy,' so it will take a few more days of positivity to drive this. The index is clinging to its outperformance against the S&P 500.
The S&P 500 did manage to clear resistance of its bull trap, but not the double top from November/December. Technicals are net negative, including an underperformance relative to the Russell 2000 (NYSE:IWM).
The Russell 2000 returned to its 50-day MA after a series of days trading at a level previously associated with the November/December swing highs. Technicals are mostly positive, but the MACD remains negative. The index is outperforming the Nasdaq.
We need to see more from the indexes as Friday's gains managed to stall the market decline. The moving averages are proving to be critical support, but they need to be launch points for rallies, not support which is constantly tested. We have seen the positive MA test in the S&P 500 and Nasdaq, but now we need to see the push-off.
Get The App
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.