Technical Picture - Broad Based Gains to Start the New Year

Markets gapped up and broad based accumulation ensued to start the New Year. Both the Nasdaq and the S&P rallied beyond the top of the recent, tight trading channels. After breaching the channels, prices slowly reversed, forming rounded tops intraday. Rounded tops are bearish, implying too much supply, not enough demand at these prices.

I wouldn't be surprised to see a double top develop. Watch the 5 day MA intraday, for support. If a double top forms, we could see some fast selling.

The $USD bounced back today as we discussed last night. That accounts for the weakness in precious metals. Although the greenback failed to hold most of its gains into the close, it stopped the bleeding from last week and manged to close slightly above its 50 SMA.

NQ emini futures trade. Long on break of bull flag. Exit after higher prices fail to print red price bars, indicating a loss of momentum. Wish I had shorted, but was not expecting such a big afternoon slide, given the early momentum.

Early strength was faded, as many commodity names had moved too far, too fast. By EOD we had a lot of bearish shooting stars and doji shooting stars

MIPS broke out and held most of its gains into the close.

Make money in affiliate marketing Click Here!