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US Market Overview

August 30, 2005 - Markets lift from support with limited conviction




In just over three weeks, the markets have carved out noticeable losses.

At Monday''s close, the S&P 500 had slipped 2.6% from the August high, while the Dow has given back 2.4% and the Nasdaq had dropped a more pronounced 3.7%.

Yet in the case of the S&P 500 and the Nasdaq, this recent pullback has come immediately after each index made four-year highs to start the month.

So after three weeks of losses, the question is whether this recent pullback has inflicted longer-term technical damage, or still more closely resembles garden-variety consolidation within the context of a primary uptrend.








The S&P 500''s hourly chart above serves as a detailed view of the past three weeks.

As the chart illustrates, the S&P finally staged a modest lift from support around 1,200 on Monday. More specifically, it touched an intraday low at 1,201 before closing near session highs at 1,212.

Still, even with Monday''s respectable lift, the S&P remains within a well-entrenched downtrend.

As suggested in Monday''s review, a close above that 1,218 level is where the near-term bias would turn more firmly higher. That area matches the January high and its three-week downtrend.









The near-term picture on the Dow Industrials is similar to that on the Nasdaq.

After bottoming early Monday, the Dow rallied more than 100 points from its session low to close at 10,463.

Yet even with those gains, the index has yet to clear the first significant resistance around the 10,500 level. So like the S&P, the Dow''s near-term outlook would further improve on a close above that 10,500 area.









From a technical standpoint, the Nasdaq did something unusual Monday. It closed above its three-week downtrend.

Recall last week, the index challenged its downtrend, before stalling at resistance and ultimately closing near session lows.

Monday''s session was almost the exact inverse. The index touched a new low at 2,112, before rising throughout the session to close near session highs.

Again, Monday marked the first time in three weeks the index had closed above its downtrend.










Widening the view to the daily time frame adds perspective to the Nasdaq''s recent price activity.

It also illustrates the significance of Monday''s close.

Namely, the Nasdaq ended Monday at 2,137, or precisely on its 50-day moving average.

So after bottoming Monday at 2,112 - just slightly above the 2,100 level - the index lifted 25 points from its session low to close on its 50-day moving average.

(After the initial breakout in July, the breakout point spanning from 2,100 to 2,114 was established as a potential target as early as July 14.)









The Dow Industrials also rallied Monday, after bottoming very close to the designated support.

More specifically, the Dow briefly touched an intraday low at 10,349, before rising to close more than 100 points higher at 10,463.

Yet even with that rally, the Dow still holds under its major moving averages. Based on the current picture, the Dow''s 50-day moving average rests at 10,532, while its 200-day holds at 10,539.










As this next chart illustrates, the S&P 500 continues to test notable longer-term support.

Namely, the S&P has closed in on the cross section of the neckline and the lower band of its four-month ascending channel.

So while holding support is nice - which is what the S&P is doing by the skin of its teeth - a close above that 1,218 level is where the near-term bias would turn more firmly positive. That area matches the January high and its three-week downtrend.

The bigger picture

What the charts above illustrate is that on Monday''s session, each index lifted from support. More specifically, the three support points Monday fell out as follows:

S&P support just above the 1,200 level.
Dow support around 10,360.
Nasdaq support at 2,112.
Each of those areas is relatively easy identify, and the markets lifted from those support points Monday despite an adverse catalyst to start the week - Hurricane Katrina.

That''s the bullish side of the story.

Yet what the major averages haven''t done for almost a month is reclaim resistance of any significance. For all practical purposes, they''ve been mired in this light-volume, and slightly disconcerting, three-week pullback from which they refuse to lift.

Looking specifically at the Nasdaq, its response on Monday was at least slightly encouraging. It bottomed just above longer-term support at the 2,100 level and rallied straight into the 50-day moving average. With that rally, it notched its first close above its three-week downtrend.

Meanwhile, the Dow and the S&P 500 really have yet to trade back above significant resistance - for the entire month.

So as suggested Monday, it would get easier to be positive on the S&P if it could reclaim resistance at 1,218. That level matches the January and the June highs, and also approximates its three-week downtrend.

A close above that area would imply there are buyers sufficient to neutralize well-defined resistance, confirming the primary uptrend.

Looking out truly longer-term, the technical backdrop remains bullish. The Nasdaq and the S&P hold positive chart patterns, and the August pullback has come on light volume and neutral internals. Each index is positioned above its 200-day moving average.

Outside of the straight technical levels, the August employment report is set for release Friday. This is frequently the biggest report of the month, and the market''s response could set the tone for near-term market direction heading into September.

US Market Overview

August 31, 2005 - Another lukewarm lift from support



The pre-market bias is flat to higher Wednesday with crude-oil futures holding just under $70 a barrel.

Early strength follows another down day for U.S. stocks Tuesday. The Dow Industrials dropped 50 points, the Nasdaq lost 7 points and the S&P 500 slipped 3.8 points.







The S&P 500''s hourly chart above serves as a detailed view of the past three weeks.

For the second straight session, the S&P has maintained support at 1,201. It touched an intraday low Monday at 1,201.5 followed by Tuesday''s low at 1,201.0.

And after lifting from support, the S&P ended Tuesday at 1,208, stalling in the general area of its neckline.









The near-term picture on the Dow Industrials is similar to that on the S&P 500.

Like the S&P, the Dow has notched two straight sessions in which support has held at the same level.

It touched an intraday low Monday at 10,349, followed by Tuesday''s low of 10,350.

Also like the S&P, the Dow hasn''t exactly bolted from support. It closed Tuesday at 10,412, holding well within the lower half of its three-week range.








The Nasdaq was the only major index not to retest Monday''s low.

In fact, it notched its second consecutive close above its downtrend, ending Tuesday at 2,129, or precisely on the designated support.

Also note that after staging the bullish reversal on Monday, Tuesday was an "inside day" in which the entire day''s range fell between (inside) Monday''s high and low.

An inside day implies orderly consolidation of the preceding move, which in this case, was the respectable Monday rally.









Widening the view to the daily time frame adds perspective to the Nasdaq''s recent price activity.

For about a week now, the index has been testing its 50-day moving average.

Based on the current picture, its 50-day holds at 2,139, or roughly 10 points above Tuesday''s close.

On further weakness, support spanning from 2,100 to 2,112 is still the best area to track. Recall that area was closely observed as resistance for the five months spanning February to June.









The Dow Industrials continues to hold under its major moving averages.

Yet over the past two sessions, it has established better-defined support at the 10,350 level.

As illustrated on the hourly chart, the Dow touched an intraday low Monday at 10,349, followed by Tuesday''s low of 10,350.










As this next chart illustrates, the S&P 500 continues to test notable longer-term support.

More specifically, the S&P has closed in on the cross section of the neckline and the lower band of its four-month ascending channel.

As suggested earlier this week, a close above that 1,218 area would add credibility to the S&P''s uptrend. Again, that 1,218 level matches the January and June highs, as well as its 50-day moving average, which currently holds at 1,219.

The bigger picture

While Tuesday''s session didn''t look impressive, the major averages have maintained support now for two straight sessions. The specific areas currently in play fall out as follows:

S&P support just above the 1,200 level.
Dow support around 10,350.
Nasdaq support at 2,112.
As suggested Tuesday, each of the above areas is easy to identify, and the markets have maintained those support points despite the skittishness tied to Hurricane Katrina.

Looking specifically at the Nasdaq, it still looks healthy longer-term, maintaining a posture above the 2,100 level, and notching two consecutive closes above its three-week downtrend.

Meanwhile, the S&P hasn''t technically broken down yet, but it continues to hold uncomfortably close to the neckline of its inverse head-and-shoulders pattern. A close above resistance at 1,218 would confirm there are buyers present, adding credibility to the bull case.

Again, that 1,218 level matches the January and June highs, as well as its 50-day moving average, which currently holds at 1,219.

Outside of the straight technical levels, the August employment report is set for release Friday. This is frequently the biggest report of the month, and the market''s response could set the tone for near-term market direction heading into September.




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US Market Overview

September 1, 2005 - Markets finally show signs of life


The pre-market bias is flat to higher Thursday despite personal income and spending data showing U.S. households spent more than they earned for just the second time in 46 years.

Personal income rose 0.3% while spending spiked 1%, resulting in a savings rate of negative 0.6%, the lowest reading in more than 45 years of records.

Early strength follows one of the few significant rallies for the U.S. markets in August. The Dow Industrials rose 68 points, the Nasdaq gained 22 points, and the S&P 500 rallied 11.9 points.








The S&P 500''s hourly chart above serves as a detailed view of the past three weeks.

As the chart illustrates, Wednesday''s rally was deceptively strong.

After clearing resistance around 1,209 to 1,210, the index spiked straight higher in the final two hours.

And with those gains, the S&P cleared its three-week downtrend, also edging out well-defined resistance around 1,218.









The Dow also rallied Wednesday but remains characteristically the weakest index.

With Wednesday''s gains, it notched its best close in a week, but has yet to reclaim resistance at 10,500.








The Nasdaq''s near-term picture looks similar to the S&P''s.

Recall that going into Wednesday''s session, the Nasdaq had notched two consecutive closes above its four-week downtrend.

On Wednesday, it finally placed distance above the downtrend, closing above resistance at 2,145 for the first time since Aug. 15.








Widening the view to the daily time frame adds perspective to the Nasdaq''s recent price activity.

As the chart illustrates, the Nasdaq on Wednesday placed distance above its 50-day moving average for the first time in a week.

Based on the current picture, its 50-day holds at 2,141, or roughly 11 points under Wednesday''s close.

So after trending steadily lower throughout August, the index finally turned higher on the month''s final session.










The Dow Industrials also rallied Wednesday, after establishing support at 10,350.

Yet even with Wednesday''s gains, the Dow still holds under its major moving averages. Based on the current picture, the Dow''s 50-day moving average rests at 10,526, while its 200-day holds at 10,538.

So from current levels, initial resistance holds at 10,500 and is closely followed by those major moving averages.









As this next chart illustrates, the S&P 500 has finally lifted from longer-term support.

More specifically, the S&P has lifted from neckline of its inverse head-and-shoulders pattern, reversing Wednesday to close above resistance at 1,218.

Also note that the S&P ended Wednesday essentially on its 50-day moving average. Its 50-day technically holds at 1,219.9 while the index closed Wednesday at 1,220.3.

So looking ahead, the S&P''s near-term outlook would further improve to the extent it can sustain the break above 1,218 and place added distance above its 50-day.

The bigger picture

On the final session of August, the markets finally showed signs of life.

In fact, Wednesday marked the first time the markets staged a "real" rally in about four weeks.

Admittedly, the size of Wednesday''s gains wasn''t exactly off the charts. Again, the Dow gained just 68 points.

Still, total volume was strong Wednesday with 2.3 billion shares traded on the NYSE, while the Nasdaq turned 1.7 billion shares.

At the same time, the market internals were also solid.

Advancing volume outpaced declining volume by nearly 4 to 1 on the Nasdaq and almost 5 to 1 on the NYSE. Not quite bullish extremes, but still solid readings, and noticeably stronger internals than those posted throughout the August downturn.

So in the end, Wednesday marked the first real signs of conviction in several weeks - either to the downside or the upside.

And behind that conviction, the major averages finally traded back above notable resistance.

In a single session, the S&P reclaimed the 1,218 level and just barely edged back above its 50-day moving average.

Meanwhile, the Nasdaq broke more decisively above its 50-day moving average, also trading back above resistance at 2,145, and placing distance above its four-week downtrend.

While this four-week pullback had looked completely mundane, one of the sticking points had been that the markets absolutely refused to reclaim even relatively minor resistance. That drawback was resolved with Wednesday.

In the end, Wednesday''s gains were stronger than they may have appeared on their face. The S&P has successfully tested its neckline, and the Nasdaq has rallied from support just above the 2,100 level.

This will be the final review until Tuesday. The U.S. markets are closed Monday. Have a great holiday, and we''ll be back Tuesday morning.




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VN Market Overview


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Data for: 05/09/2005

US Market Overview

September 6, 2005 - Markets set to build on last week''s rally


The U.S. markets had several excuses to break down last week.

The final week of August is typically among the most thinly traded all year, and as the massive Gulf Coast rebuilding process became more visible, it''s easy to see how many investors might have taken to the sidelines.

Yet with every reason to sell off, the major averages instead posted net gains last week, leaving them technically well positioned to rise further in September.









The S&P 500''s hourly chart above serves as a detailed view of the past three weeks.

As the chart illustrates, the S&P cleared two notable technical levels last week. It traded back above its downtrend, illustrated in green, and also reclaimed the January high of 1,218.

Also note that after breaking back above the 1,218 level, the S&P subsequently observed that area as support. In fact, it ended last week almost exactly on that level, at 1,218.02.









The Dow also rallied last week, but remains characteristically the weakest index.

With last week''s gains, it survived a test of support around 10,350, but has yet to reclaim resistance at 10,500.










The Nasdaq''s near-term picture looks similar to the S&P''s.

Again, the Nasdaq has finally cleared its four-week downtrend, placing distance above that area late last week.

Yet also note where the index stalled last week. It touched the week''s high at 2,157, closely matching the technical level introduced in the Aug. 12 and Aug. 16 reviews.











Widening the view to the daily time frame adds perspective to the Nasdaq''s recent price activity.

As the chart illustrates, the Nasdaq bottomed last Monday at 2,112, marking a successful test of well-defined support around 2,100.

Also note that after lifting from support, the index reclaimed its 50-day moving average. It technically closed last week at 2,141 or just one point under its 50-day moving average of 2,142.










The Dow Industrials also rallied last week, after establishing support at 10,350.

Yet even with those gains, the Dow still holds under its major moving averages. Based on the current picture, the Dow''s 50-day moving average rests at 10,524, while its 200-day holds at 10,537.

So from current levels, initial resistance holds at 10,500 and is closely followed by those major moving averages.










As this next chart illustrates, the S&P 500 has finally lifted from longer-term support.

More specifically, the S&P has lifted from neckline of its inverse head-and-shoulders pattern, just barely trading back above resistance at 1,218.

Also note that at last week''s close, the S&P was challenging its 50-day moving average, currently at 1,220.

So looking ahead, the S&P''s near-term outlook would further improve to the extent it can sustain the break above 1,218 and place added distance above its 50-day.

The bigger picture

Throughout August, the U.S. markets faced one major problem - a complete inability to trade back above resistance of any kind.

For almost four weeks, both the S&P and the Nasdaq had been stuck in a steady, light-volume pullback from which they refused to lift.

That changed last week, despite what appeared to be the worst of circumstances.

That is, in a week that''s normally tagged as one of the year''s most thinly traded - and against the less-than-ideal backdrop of Hurricane Katrina - both the Nasdaq and the S&P traded back above their one-month downtrends.

And from a technical standpoint, the rally truly took hold last Wednesday. That''s the session the S&P broke from its downtrend, and reclaimed resistance at 1,218. It''s also the session the Nasdaq reclaimed its 50-day moving average.

So as the cornerstone of last week''s rally, it''s worth revisiting the internal characteristics of Wednesday''s session.

Total volume was unusually strong Wednesday with 2.3 billion shares traded on the NYSE, while the Nasdaq turned 1.7 billion shares.

At the same time, the market internals were also solid.

Advancing volume outpaced declining volume by nearly 4 to 1 on the Nasdaq and almost 5 to 1 on the NYSE. Not quite bullish extremes, but still solid readings, and noticeably stronger internals than those posted throughout the August downturn.

So again, Wednesday marked the first real signs of conviction in several weeks - either to the downside or the upside.

And behind that conviction, the major averages finally traded back above notable resistance.

In the context of the past month, last week''s rally was more significant than it may have appeared on its face. The S&P has successfully tested its neckline, and the Nasdaq has rallied from support just above the 2,100 level.

US Market Overview

September 7, 2005 - Another sharp rally from support



The pre-market bias is flat to lower Wednesday following modest gains in overseas markets.

Early weakness follows another strong session for U.S. stocks Tuesday. The Dow Industrials rose 141 points, the Nasdaq gained 25 points, and the S&P 500 added 15.3 points.









The S&P 500''s hourly chart above serves as a detailed view of the past three weeks.

After the initial spike above its downtrend last Wednesday, the S&P carved out two sessions of consolidation, successfully retesting the 1,218 level as support.

Then Tuesday, it extended its uptrend with another strong spike higher.

That general pattern - steep rally, followed by orderly consolidation, and a second spike higher - is bullish.

At Tuesday''s close, the index held just under three-week highs.










The Dow Industrials also showed signs of life Tuesday.

Notice the steep break higher after the index cleared resistance around 10,500.

That rally marks the first time the Dow has reclaimed significant resistance in about a month.









The Nasdaq''s near-term picture remains similar to that on the S&P.

Again, the Nasdaq staged a sharp break higher last Wednesday followed by two sessions of orderly consolidation.

Then Tuesday, it extended its gains with another steep rally, making three-week highs in the process.

Note that Tuesday''s close at 2,166 closely matched the resistance previously designated at 2,165.

From current levels, initial support holds at 2,157, and is followed by Tuesday''s open at 2,147 and an additional floor at 2,139.









Widening the view to the daily time frame adds perspective to the Nasdaq''s recent price activity.

As the chart illustrates, the Nasdaq bottomed last Monday at 2,112, marking a successful test of well-defined support around 2,100.

Since then, the index has staged a relatively steep rally, placing distance Tuesday above its 50-day moving average.

Also note that in about a week, the Nasdaq has retraced exactly half of the August downturn. The mid-point technically falls at 2,166.1, and the index closed Tuesday at 2,166.8.

So that 2,166 level represents a 50% retracement of the prior leg lower, marking an area that could represent near-term resistance.









The Dow Industrials finally reclaimed its major moving averages Tuesday.

So the index not only traded back above resistance at 10,500, illustrated on the hourly chart, but it also extended above its 50-day and its 200-day.

Looking ahead, those areas should represent near-term support.

Based on the current picture, the Dow''s 50-day moving average rests at 10,530, while its 200-day holds at 10,537. The Dow closed Tuesday at 10,589.











As this next chart illustrates, the S&P 500 continues to lift from longer-term support.

More specifically, the S&P has lifted from neckline of its inverse head-and-shoulders pattern, and the support point at 1,218.

At Tuesday''s close, the S&P held just 12 points under four-year highs.

The bigger picture

With the benefit of hindsight, the Nasdaq and the S&P 500 have held relatively true to form.

The S&P has successfully tested its neckline, and the Nasdaq has rallied from support just above the 2,100 level.

Yet it''s also worth noting that after lifting from support, the retracement of the August downturn has occurred relatively quickly.

Again, at Tuesday''s close, the S&P held just 12 points under four-year highs. At the same time, the Nasdaq has retraced 50% of the August downturn in just a week.

So looking back, that Chinese water torture in August has been met with a relatively steep recovery over the past four sessions. The difference in the slope of those two moves - the shallow August pullback, and the steeper one-week rally - suggests the primary trend is higher.

It''s also worth quickly touching on the volume stats Tuesday.

Volume was on the light-to-moderate side, with the Nasdaq turning 1.46 billion shares, and 1.93 billion traded on the NYSE.

Still, the internals Tuesday were again noticeably strong. Advancing volume outpaced declining volume by almost 4 to 1 on the Nasdaq, and by 5 to 1 on the NYSE. Those are almost identical numbers to those posted last Wednesday - the beginning of the current upturn.

So this still isn''t quite picture perfect price action (it rarely is), but the solid internals and the steep recovery are enough to confirm the primary uptrend. As the S&P and the Nasdaq have just proven, this is still a market to buy on pullbacks to support.

US Market Overview

September 8, 2005 - S&P 500''s within striking distance of four-year high



The pre-market bias is slightly lower Thursday with crude-oil futures rising back atop $65 a barrel.

Early weakness follows another session of gains for U.S. stocks on Wednesday. The Dow Industrials rose 44 points, the Nasdaq gained 5 points and the S&P 500 added 2.9 points.









The S&P 500''s hourly chart above serves as a detailed view of the past three weeks.

Since successfully testing support at 1,218, the S&P has rallied sharply without really pulling back.

At Wednesday''s close of 1,236, the index held just nine points under four-year highs.

Also note that on this three-week view, the index has taken the shape of an inverse head-and-shoulders pattern. The neckline of this pattern holds roughly at 1,227 and marks the first notable support on a pullback.

Recall the S&P broke from a larger, and more important, inverse head-and-shoulders formation in late July. That pattern is visible on the daily chart, further down the page.










In just two sessions, the Dow Industrials has finally come to life.

After clearing resistance at 10,500, the Dow moved straight to the next designated overhead at 10,640.

More specifically, it touched an intraday high Wednesday at 10,640.4, precisely matching the designated resistance.

On further strength, the next significant overhead holds in the 10,700 to 10,719 range.









The Nasdaq''s near-term picture remains similar to that on the S&P.

Again, the Nasdaq staged a sharp break higher last Wednesday followed by two sessions of orderly consolidation.

This week, it has extended its gains with another steep rally, making three-week highs.

Next resistance holds at 2,185, closely followed by the January high of 2,192. The index closed Wednesday at 2,171.











Widening the view to the daily time frame adds perspective to the Nasdaq''s recent price activity.

As the chart illustrates, the Nasdaq bottomed last Monday at 2,112, marking a successful test of well-defined support around the 2,100 mark.

Since then, the index has staged a relatively steep rally, placing distance this week above its 50-day moving average.

The steep lift from support -- and the upward-sloping 50- and 200-day moving averages -- confirms the primary trend is higher.










The Dow Industrials reclaimed its major moving averages Tuesday, and placed further distance above those levels Wednesday.

From current levels, the next significant overhead holds in the 10,700 to 10,719 area.










As this next chart illustrates, the S&P 500 has extended its rally from longer-term support.

More specifically, the S&P has lifted from the neckline of its inverse head-and-shoulders pattern, and from the support point at 1,218.

At Wednesday''s close, the S&P held just nine points under four-year highs.

The bigger picture

After Wednesday''s modest gains, the overall technical backdrop is essentially unchanged.

Over the past week, the S&P has successfully tested its neckline, and the Nasdaq has rallied from support just above the 2,100 level.

Yet sometimes tracking the day-to-day technical backdrop inadvertently masks the overarching picture.

That is, the Nasdaq and the S&P have not only successfully tested support but in doing so, they''ve confirmed bullish longer-term chart patterns.

While the S&P''s inverse head-and shoulders pattern has been well documented here, the Nasdaq has a comparable pattern that was addressed in detail as far back as July 29.

And without reinventing the wheel, that July 29 review describes how longer-term price targets can be assigned using those patterns.

The Nasdaq''s longer-term target holds in the 2,311 to 2,328 range based on the depth of its pullback from the March high to the April low.

The S&P''s corresponding target holds at 1,300.

Assuming those targets hold, they amount to about 6.8% of additional upside on the Nasdaq, and roughly 5.2% of potential gains for the S&P.

US Market Overview

September 9, 2005 - Steep rally from long-term support intact




The pre-market bias is higher Friday following well received guidance from semiconductor bellwethers Intel and Texas Instruments.

Early strength follows modest losses for U.S. stocks Thursday. The Dow Industrials dropped 37 points, the Nasdaq lost 6 points, and the S&P 500 slipped 4.7 points.









The S&P 500''s hourly chart above serves as a detailed view of the past three weeks.

As the chart illustrates, Thursday''s narrow 4-point loss added little to even this very near-term view.

After spiking above its former downtrend, the index consolidated its gains, closely observing the 1,218 level as support.

It then extended its gains for two straight sessions, before carving out another consolidation day Thursday.










Unlike the other two indexes, the Dow Industrials has yet to break from its three-week range.

In fact, after precisely observing resistance at 10,640, the index backed off slightly Thursday, ending the session at 10,595.

Despite its range-bound price action, this is the strongest the Dow has looked in almost a month.










The Nasdaq''s near-term picture remains similar to that on the S&P.

Like the S&P, the Nasdaq pulled back modestly Thursday without suffering any real technical damage.

In fact, the Nasdaq closed Thursday precisely on the first designated support at 2,166 - it technically ended Thursday at 2,166.03.

On further weakness, next support holds at 2,157.











Widening the view to the daily time frame adds perspective to the Nasdaq''s recent price activity.

As the chart illustrates, the Nasdaq bottomed two weeks ago at 2,112, marking a successful test of well-defined support around the 2,100 mark.

Since then, the index has staged a relatively steep rally, placing distance this week above its 50-day moving average.

The steep lift from support -- and the upward-sloping 50- and 200-day moving averages -- confirms the primary trend is higher.









The Dow Industrials reclaimed its major moving averages Tuesday, and has since sustained the break above those levels.

From current levels, first resistance holds at its three-week range top of 10,640 and is followed by its five-month range top spanning from 10,700 to 10,719.











As this next chart illustrates, the S&P 500 has extended its rally from longer-term support.

More specifically, the S&P has lifted from the neckline of its inverse head-and-shoulders pattern, and from the support point at 1,218.

Even with Thursday''s losses, the S&P held just 14 points under four-year highs.

The bigger picture

Looking back at the past two weeks, there have been two sessions that confirmed the longer-term uptrend.

The first session was last Wednesday - the final session of August - in which the markets rallied on strong volume and bullish internals.

That day, the NYSE turned 2.3 billion shares and the Nasdaq traded 1.7 billion shares. On the internals, advancing volume outpaced declining volume by nearly 4 to 1 on the Nasdaq and almost 5 to 1 on the NYSE.

And the potential implications of that Aug. 31 session were touched on in the Sept. 1 review.

The second session to confirm the uptrend was Tuesday, Sept. 6. There, volume was more limited, but the internals again looked relatively healthy. For the second time in five sessions, advancing volume outpaced declining volume by nearly 4 to 1 on the Nasdaq and by 5 to 1 on the NYSE.

With those two sessions, the Nasdaq and the S&P have staged steep rallies after successfully testing obvious longer-term support.

So looking back, part of the challenge in August was simply waiting for volume to return after the U.S. Labor Day holiday. With that waiting game out of the way, the markets have responded exactly the way market bulls would like - with a decisive lift from well-defined support.

Again, the S&P has successfully tested its neckline, and the Nasdaq has rallied from well-defined support just above the 2,100 level.

And as one final point, the Nikkei just made four-year highs last night behind the strongest volume ever recorded on the Tokyo Stock Exchange - 3.0 billion total shares.

US Market Overview

September 12, 2005 - Dow finally breaks from its range



The pre-market bias is flat to higher Monday behind ongoing strength in Asian markets and further moderation in crude-oil futures.

The neutral tone early follows solid gains for U.S. stocks Friday. The Dow Industrials rose 82 points, the Nasdaq rallied 9 points, and the S&P 500 gained 9.8 points.








The S&P 500''''s hourly chart above serves as a detailed view of the past three weeks.

As the chart illustrates, the index has staged a series of sharp rallies followed by shallow consolidation.

Those include the sharp rally from its former downtrend, the step lift from support at 1,218 and Friday''''s extension of the rally.











The Dow Industrials finally broke from its three-week range Friday.

Note that after clearing resistance at 10,640, the index stalled intraday at 10,696 or essentially on the next resistance spanning from 10,700 to 10,719.

Looking ahead, the 10,719 level marks its five-month range top.










The Nasdaq also extended its gains Friday.

After maintaining support in the general area of 2,164 to 2,166, the index edged to a one-month high Friday, closing the week at 2,175.

Looking ahead, next resistance holds at 2,185, closely followed by the January high of 2,192.











Widening the view to the daily time frame adds perspective to the Nasdaq''''s recent price activity.

With last week''''s rally, the index reclaimed its 50-day moving average and now holds within striking distance of the August high.

So with Friday''''s close at 2,175, the Nasdaq holds just 44 points from four-year highs.











The Dow Industrials reclaimed its major moving averages early last week and managed to sustain the break above those levels.

Again, on Friday the index stalled just under resistance at 10,700 before closing at 10,678.

That means at Friday''''s close, the Dow held about 51 points under five-month highs.

(Also note that with the passage of time, the five-month high of 10,719 will be a six-month high by week''''s end.)













The S&P 500 continues to lift from its inverse head-and-shoulders pattern.

With Friday''''s close at 1,241, the S&P held just four points under four-year highs.

The bigger picture

With last week''''s rally, the major averages edged within striking distance of notable levels.

The S&P closed Friday just four points under four-year highs, while the Nasdaq held a slightly more distant, though still attainable, 44 points from four-year highs.

At the same time, the Dow - which has consistently lagged the other two indexes - can make six-month highs by ending this week above the 10,719 level. Its four-year high holds 306 points from current levels.

Yet it''''s also worth noting that Friday''''s gains once again occurred on solid volume. The NYSE turned 2 billion shares Friday, while the Nasdaq registered 1.67 billion total shares.

So the general pattern of rising on strong volume, and backing and filling on lighter relative volume, is also intact.

At the risk of beating a dead horse, the primary trend remains higher. The S&P has successfully tested its neckline, and the Nasdaq has rallied from support just above the 2,100 level.










Được oanhoncodon sửa chữa / chuyển vào 07:19 ngày 13/09/2005