INDICES RALLY TO START WEEK, NASDAQ TESTING KEY RESISTANCE, BLUE CHIPS TRAIL
By Harry Boxer, The Technical Trader (www.thetechtrader.com)

The markets had a strong start to the week in an very positive day for the bulls. The indices opened strong, backed off, held support immediately, and then rallied steadily in the morning, consolidated mid-day, rallied to new session highs in the afternoon, and consolidated in the last hour in bull flag formations.

They sure look like they want to go even higher. Although the last hour consolidation did come right at the earlier double-top, now constituting nearly a triple-top on the Nasdaq 100 just under 2000. This is an area they want to punch through to extend this market. The S&P 500 is far short of its earlier double-top over 1420, closing at 1403, so they have work to do .

Net on the day the Dow was up 130 1/2, the S&P 500 15.30, and the Nasdaq 100 36 3/4. The Philadelphia Semiconductor Index (SOXX) was back over 400 at 403.12, up 4.62.

The technicals were positive by nearly 3 to 1 on advance-declines on the NYSE, and 2 1/2 to 1 on Nasdaq. Up/down volume was a little more than 3 to 1 positive on New York on light volume just over 1 billion shares. Nasdaq traded about 1 3/4 billion with a much better ratio on up/down volume of 4 to 1 positive.

TheTechTrader.com board, as a result, had an outstanding session today with multiple point-plus gainers. Leading the way were the shippers, with portfolio position Excel Maritime (EXM) up 5.37, DryShips (DRYS) up 4.62 and TBS International (TBSI) up 3.11, rounding out the three major shipping stocks I follow.

Canadian Solar (CSIQ) was up 1.56, and former Chart of the Week GeoResources (GEOI) at 22.50 was up 2.47, closing at an all-time high. Energy Conversion Devices (ENER) followed up on last week's big move, up another 3.88 on 6 million shares, closing at 51.62.

On the downside, Clearwire (CLWR) continued lower, down 1.35, and JA Solar (JASO) on financing news and an earnings report was down 1.44.

Stepping back and reviewing the hourly chart patterns, the indices closed near key overhead resistance on the Nasdaq 100, but with the S&P 500 trailing here, I want to see some confirmation and evidence that the blue chips are along for the ride. However, today was a pretty good way to start the week.

Good trading!

Harry

Harry Boxer is an award-winning, widely syndicated technical analyst and author of The Technical Trader (www.thetechtrader.com), which features a real-time diary of Harry's minute-by-minute trades and market insights, plus annotated technical charts & stock picks, based on Harry's 30 years experience as a Wall Street technical analyst.

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