Wednesday, August 13, 2008

NASDAQ Technical Picture - Low Volume Consolidation

Energy and commodities finally caught a bid today - big moves in coal, steel, gold, metals, and oil. That plus weak financials, airlines, and retail, put pressure on the the broader markets. The NASDAQ held up fairly well and seems to be carving out a bullish flag on declining volume. Still, we need to work off this overbought posture a bit more before we can move higher.

Economic calendar: Core CPI and initial claims in pre-market.

The next chart is a 15 minute chart of RIMM. I see a H&S top. The LS is a little small, but the volume pattern is perfect - lots of momentum on the LS and Head and very lame volume on this afternoon's rally leading to a quick sell off. As you can see from the chart the trend line is not far below the BO point, so I would be cautious as price approaches the trend line if this pattern does play out. On a measured move it looks like 10 points, but I won't be greedy.


Rick said...

RIMM has definitely been weak relative to the Nasdaq lately. It looks like an inverted H&S is forming in TIE (down big right now though).

TJ said...

Hey Rick,

Missed call on RIMM probably because the intraday chart was inconsistent with the daily. The daily was an orderly pullback to the base. The H&S top didn't trigger so no harm done except to my ego.

TIE intraday reminds me of AMGN. Big sweeping up and down moves intraday, but gets shy all of a sudden, when it's time to BO. Caught a round trip on AMGN today so I'm good.