Price action on the major indices is very good today. Obviously I wish volume was higher. But the fact that we have broken through the descending trend line (formed by the lower highs) on both the S&P and the NASDAQ is very constructive. Hope fully this means we have some room to run on the upside. This is great to see so soon after the follow through day and the support the indexes got at the 50 DMA. For further confirmation of strength, I am looking for leading stocks to continue bouncing off moving average lines, moving up from tight areas and/or breaking out from recognizable chart patterns.


Best returns,


Scott O'Neil

President, MarketSmith Incorporated

Follow Scott O'Neil at Twitter.com/WScottOneil

 

 

Updated 6/20/2013:

 

Market action is not looking so good today. The S&P and NASDAQ have crashed through the 50 DMAs on heavy volume. Breaking the 50 day is bad enough, but the way we did it today makes it even worse. Maybe the market can right itself, but at this point, I would re-emphasize: you shouldn’t fight your equity, you will lose. If you aren’t making progress you should be getting smaller. Cash can be a position too.