Yesterday's market action was positive.
The Nasdaq Composite added a further 0.7% to Monday's gain and with it closing the day almost at its high indicates the possibility of more upside to come. On the downside volume was below average which indicates a lack of institutional demand.
It was good to see the SMH (chip sector) getting a shot in the arm and rising almost 2% on above average volume. This is always a positive especially with chips being the heart and soul of the Nasdaq.
Global materials outperformed the market, India and Russia underperformed. Leading stocks behaviour was neutral.
Yesterday's positive behaviour has created the possibility that the sharp correction could be over or close to and that now the market is ready to move higher again. Ideally from this point I would like to see the Nasdaq making a play to get back above its previous support level at 2800.
If it managed to pull this off, it would give me more confirmation that the recent correction is over. However, if the market turns tail today and falls on heavy volume, it would confirm the market probably needs to go down further.
Please note past performance should not be used as a guide to future performance, which is not guaranteed. Investing in the Funds should be considered a long-term investment. The value of the investment can go down as well as up and there is no guarantee that you will get back the amount you originally invested.
About ISACO
ISACO was established in 2001 by brothers Stephen and Paul Sutherland and is the first financially regulated firm to offer adventurous ISA and SIPP investors a unique personal investment service that shares on a daily basis our star-performing investor’s thoughts, personal insights and investment decisions.
Clients enjoy being informed throughout the year what ‘best of breed’ funds our premier investor currently owns, when he’s buying and when he’s moving into the safe harbour of cash – helping clients enjoy more control, manage their portfolio more effectively and benefit from the potential of outstanding long-term returns.
For more information about ISACO and our Investment Guidance Service, please read our free brochure.
If you have any questions or thoughts on the points covered in this post, please leave a comment below or connect with us @ISACO_ on Twitter.
