Yesterday's market action was positive.
The Nasdaq Composite gained 0.13% on above average volume (Point A). However Friday was an options expirations day, which often increases volatility and volume. On options expirations days, I believe it's best to focus purely on price action.
At the moment the Nasdaq does appear to be hitting resistance as it tries to climb into new high ground and clear the 3200 level. This can be clearly seen by its bearish reversal as it closed in on this level (Point B).
Although the Nasdaq did bearishly reverse when you take into consideration that it was an options expirations day, it makes it more difficult to say if institutional investors were selling, or whether they were sitting on their hands. We'll no more as we move as we move into a fresh week. What we do know however is that recently the market has been behaving positively.
Leading stocks action was positive.
Both the Nasdaq and the 600 acted well for the week. Although the Nasdaq did pullback slightly it still ended the week above its March high of 3134 (Point C). It was a similar picture with the S&P 600, even though it lost more than the Nasdaq it still finished the week above its previous resistance of 472 (Point D). Ideally from this point if these indexes do pullback further, I'd like to see these former resistances becoming support.
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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.
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