Selling Pressure Abating?
The Nasdaq is still in the “penalty box”, but is the 2-minute time (hockey reference) nearing an end? PRICE is the ultimate arbiter and the first step needed is for it to recapture its 50-day SMA. That now lies less than 1% away, and even then it is not an all-clear sign as there was a bear trap doing just that back in late March before it resumed its downtrend. But there are some positives occurring with the semis starting to act better as the SMH bounced nicely off the very round 200 number this week rising almost 3% after the prior week jumped more than 6%. AAPL as we have discussed recently is distancing itself somewhat from its 50-day SMA, but both MSFT and GOOGL were rejected there Friday. Software is still within a bearish descending triangle, however as one can see on the Nasdaq chart below the drawdowns off the downward sloping 50-day SMA have become shallower each time since April rejection. Round 2 for the Nasdaq as last Friday it also CLOSED right at resistance at the 50-day.