Rising trends slowing; Transports and Semiconductors key -- MrSwing

You Are Here: Home > Articles > Commentary > Rising trends slowing; Transports and...

Rising trends slowing; Transports and Semiconductors key
Dec 20, 2008

Declan Fallon

Fallond Stock Picks
More articles

Font Size:

Richard Lehman noted the change in slope of some of the early bull trends off the November lows. The reversal off the 50-day MAs was a big negative for me as the indices made a half-hearted attempt at defending them. Are things going into lockdown up to Christmas? Early vacation takers might see today as the last trading day for the year...
I would like to see the Transports do more in the light of weak oil prices. Things to watch:

Stochastics turning oversold - i.e. future short term weakness needed

Consolidation triangle to break - with the 50-day MA pegged to triangle resistance it may be 'easier' for prices to break through support than resistance

For November lows to hold as support

For trend strength to continue its swing bullish, perhaps signalling a stronger start for 2009

My other sector watch is the semiconductors. Yesterday's strong reversal off the 50-day MA was very discouraging.

Can the nascent rising channel hold?

Stochastics heavily overbought - this has to come back at some point and given their relative position it would appear very hard for the rising channel to continue to ascend the way it has.

Trend strength is more favourably bullish than for Transports; should help in the long run