Weekend Index Updates

Jul 7, 2007: 8:57 AM CST

We managed to survive a light volume, holiday week and end the week higher in all major indexes, yet only the Nasdaq is making fresh new highs (although they are merely new 6 year highs).  This tends to be good for the overall market, as it assumes that traders are taking more speculative risk in technology/volatile stocks rather than value or defensive stocks.



The Dow Jones is about 100 points away from fresh all-time highs, and it wouldn’t take much to push the index to a new high.  There is resistance at 13,700, as we have had six tests of this zone so far.

The weekly chart is working off its formerly overextended conditions, while the daily charts are showing stark consolidation and rangebound trading.



I am glad to report new price highs and new momentum highs on the Nasdaq index (on the daily charts).  Price is a bit overextended, and odds favor a sell swing coming up to make another higher low to confirm this major uptrend we have been experiencing.  Although the Nasdaq is making new (six-year) highs, it is just over halfway to its all-time highs (around 5,000).

The weekly chart is showing a momentum divergence, but this is absolutely no cause for panic.

The S&P 500 looks very similar (technically) to the Dow Jones, and the Russell 2000 is making a similar pattern of consolidation (no new highs yet, but they’re not far away).

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