The NASDAQ Composite Index got as far as its 50-dma on Friday at the open on another gap move to start the day, but reversed to close down on lighter volume. Note that the index also broke below the lower trendline of the ascending wedge that I noted in a tweet on Thursday.
Resistance at the 50-dma is logical, and the fact that it came on light volume amid a lot of nervousness over China tariffs, missile strikes on Syria, and the implications of the recent FBI raid of President’s Trump’s lawyer, Michael Cohen, ahead of the weekend is perhaps a slight positive. Thus, a small pullback here on lighter volume looks more normal than deleterious.
The S&P 500 Index, however, seems to lack thrust as it reversed from a point still below its 50-dma on Friday on light volume. Both the NASDAQ and the S&P are roughly right back where they closed on Tuesday’s follow-through day, with the S&P ending the week on Friday below its Tuesday close. This is of course de facto evidence of the lack of thrust on the heels of the follow-through day.
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