Good day! The major indexes have been skirting the 10-day moving averages over the past week, but managed to pull up off that support zone in Tuesday's trade as the holiday rally continued. The action has remained slower due to the shortened holiday weekend ahead, but the Dow Jones Industrial Average and S&P 500 had steady trend action throughout the session.
As anticipated, technical levels for support and resistance, as well as the common trade strategies you often see posted in this column, all held very well. They did not, however, offer the same price moves we generally see outside of holiday trade and the gains were stunted, although the narrower price action would have allowed for larger position sizes to offset this disadvantage. This is the type of action I wrote about yesterday. Although it was slower, it held biases well and there was little chance of getting flushed out of open positions since traditional stop levels were not triggered on any of the setups that formed throughout the day.
Dow Jones Industrial Average
The action in the Nasdaq was a little different than the other two major indexes. Although all three ended the session just off the day's highs, the Nasdaq spend more time within a trading channel. It only broke to new intraday highs once, which was during mid-day trade. Nevertheless, it still held technical levels well also, and the all-sessions trend was steady after it triggered a buy in premarket trade. The sharply ascending triangle intraday, however, gave an indication that buy setups intraday would have higher risk. The triangle did break higher, but the action was very slow and the index held highs at the 13:00 ET correction period.
The Dow Jones Industrial Average ($DJI) had a gain of 55.03 points, or 0.48%, and closed at 11,533.16 on Tuesday. Two-thirds of the Dow's thirty index components posted a gain for the session. The financials took the lead. Bank of America (BAC) rose 2.85%, JP Morgan (JPM) was up 2.63%, and American Express (AXP) rose 1.72%. The top decliners were 2M (MMM) (-0.93%), Merck (MRK) (-0.88%), and Intel (INTC) (-0.61%).