Nasdaq Composite (Figure 3)
The Nasdaq Composite ($COMPX) ended the session lower by 3.68 points, or 0.13%, on Thursday and it closed at 2,796.14.Bed Bath & Beyond (BBBY) (+10.45%), Costco Wholesale Corp. (COST) (+3.77%), and NVIDIA (NVDA) (+3.67%) also led the Nasdaq-100, but so did Ctrip.com (CTRP) (+2.90%) and Apollo Group (APOL) (+2.14%). the weakest performers were Lam Research (LRCX) (-4.97%), KLA-Tencor (KLAC) (-4.57%), Cerner Corp. (CERN) (-2.68%), and Netflix (NFLX) (-2.50%), which fell off a daily and weekly double top.
Despite the action in the market right now that shows signs of weakness, use caution on the indices. Instead, look for securities that are showing stronger reversal patterns than the overall market and don't be afraid to still go after intraday pockets of strength. There's going to be a lot of hesitation heading into earnings season and the market itself may wait until that kicks off before making up its mind. This has often been the case in the past. Earnings season begins on April 11th with the release of Alcoa's quarterly earnings report.
Unless otherwise stated, the index action described in this article relates to the E-mini futures contracts for the respective indices. Actual index action may differ slightly in terms of pattern formation, although the market bias will remain the same.
Toni Hansen is president and co-founder of the Bastiat Group Inc., DBA Trading From Main Street. Toni is one of the most respected technical analysts and traders in the industry. She has been trading and educating new traders, money managers, professional market analysts and traders throughout the boom and bust of the last decade. She has worked in conjunction with some of the world's top financial exchanges. Learn more about Toni Hansen and the educational services she provides through her website at http://www.tonihansen.com.