| Stock market futures update of NASDAQ and SP500 |
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| Friday, February 24, 2006 |
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Weekend Update
This update will focus on the Nasdaq. Regardless how bad the durable goods number was,and regardless how strong the blue chips were last week, this was the first week that the Nasdaq tacked on the best gains out of all the indexes.
The Nasdaq Composite (COMPQ)
On the daily chart, the Nasdaq is completing its wave 3 to 4 correction in the shape of an ascending symmetrical triangle. As previously stated, the Nasdaq had the best gains for the week. It also outperfomed the S&P 500 for a change. The Nasdaq looks poised to break the downtrend line any day now. The indicators are already hinting at this. The RSI is neutral but pointing upwards and and the Williams % and PPO and stochastics are now bullish. However, we are waiting on the Aroon to go trending.
Furthermore, the whole pattern on the COMPQ has been overlapping. This is why this market has been all about sector performance rather than the performance of the index itself. Supporting the COMPQ has been the strength of the biotech sector. In addition, the Nasdaq Composite bullish percent index looks good. It has no bearish divergence whatsover. This means that the Nasdaq is healthier and that more stocks are going on to hit buy signals and continue on to make new highs.
The Russell 2000 Small Cap Index (RUT)
The RUT is making new 52 week highs and continues to lead the market higher. Small caps remain the leaders. This is significant because from a technical perspective this means that we cannot even be close to the last leg of the market rally. The last leg of a market rally is typically dominated by large cap stocks leading the market higher. At this point, the large caps are still underperformoing the small and mid caps. On the the monthly RUTchart, the ascending triangle pattern suggests a price target of approximately 850 sometime this year.
Nasdaq Futures (NQ)
Nasdaq Futures closed right on the downtrend line all week and are stalling at reistance levels. There is bullish divergence in the macd and indicators are turning up. At 5 minutes before and after the close futures were hitting 52 week highs. People were being forced to cover, and this will likely lead to more aggressive buying in NQ futures and then in the broader market as well.
NASDAQ
NASDAQ 60 MINUTE CHART
NASDAQ BULLISH PERCENT INDEX
RUSSELL 2000 SMALL CAPS
NQ (NASDAQ 100 FUTURES) CLOSED ON THE DOWNTREND LINE
NQ (NASDAQ 100 FUTURES) BULLISH DIVERGENCE DAILY CHART
NQ (NASDAQ 100 FUTURES) 5 MINUTE CHART
SP500 FUTURES
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