MARKET SOARS AS FEARS OF WAR FADE - NASDAQ & RETAILERS LEAD

John Murphy
by John Murphy,
Chief Technical Analyst, StockCharts.com

NASDAQ RALLIES ON INCREASED VOLUME - 40 WEEK MOVING AVERAGE CHALLENGE... The Nasdaq Composite rallied 2.67% to close above its 40-week (200-Day) moving average. However, a Friday close over the moving average is necessary to validate an upside penetration on the weekly chart. Heavier volume is also encouraging since rising volume is an important element necessary to support a sustainable rally. Foundry's (FDRY) soared over 16% on massive volume and appears to have completed an island reversal pattern (see shaded circle) which is bullish. FDRY's next level of resistance is near its December peak (see square). Juniper (JNPR) surged 12%, and Network Appliances (NTAP) rallied over 10%. Both stocks rallied on heavy volume and appear poised to challenge their December highs. Oracle extended its rally to close at a new 52-week high. The stock's 50 and 200-day moving averages have crossed over, forming a "golden cross" [50-day moving average crosses up above a 200-day moving average] which is positive.

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RETAILERS GET MARKED UP... In today's earlier update, we showcased several retail stocks that were being marked up. The strength in this area extended into the close. Best Buy (BBY) closed up over 11%. Sears (S) closed up over 8%.

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John Murphy
About The Author:

John is a renowned author in the investment field and former technical analyst for CNBC. Considered the father of intermarket technical analysis, his books include “Technical Analysis of the Financial Markets” and “Trading with Intermarket Analysis”. Learn More 

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