Yesterday's market action was positive.
The Nasdaq Composite gained 1.04% in above average volume (Point A).
When volume is above average and the market makes a strong gain, it means institutional investors are aggressively buying stock, helping to strengthen the market and make it prone to further price rises.
Leading stocks action was neutral.
Yesterday the Nasdaq broke out of a bullish cup-with-handle formation (Point B). With volume coming in above average (Point C) on the breakout, it means the probability the breakout will be successful has increased. Not all breakouts work out and some reverse just after making their move.
What ideally we want to see now is a continuation of this breakout over the next few trading days and hopefully breaking through the resistance at 3085 (Point D) and 3134 (Point E) or in the very least holding onto most of Thursday's gains.
Bearish behavior would be selling off in heavy trade. From how the market is currently acting, the breakout should prove successful but as always we have to take it one day at a time. My thinking is, so far so good.
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