Monday, February 04, 2008

Volume down, price down

Today's Qs action confirmed my weekend skepticism of the previous end of week rally. At the open the Qs showed absolutely no inclination to break towards the 46 reistance line mentioned this weekend, but instead went negative out of the box. I'd expected to see more volume today on the downside, as the action was particularly virulent in the financials. . .but the mood was surprisingly restrained. Once the Qs bounced off that PP pivot at 11:30 and the parabolics turned negative, you had to know that S1 was the next stop.
Since the Qs have bounced off the LR30 mean to the downside and the daily RSI is coming off an overbought reading , I'm going with the assumption that the near term support at 43.55 will get tested sometime soon. If the Qs break through that level, then we are obviously looking for a retest of support at 42.
My opinion is that this is strictly a market for scalps and daytrades. . .overnight positions are just too risky for my comfort level.

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