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State of the Stock Market - 9/8/10

Following a pullback yesterday, we had a nice bounceback session today on Wall Street, with stocks starting the day slightly higher and moving up from there until around 11:00.   At that point, they basically just chopped sideways, but didn't give much back overall and ended with decent sized gains.   Volume looks like it will be higher on both indices which is nice to see.

Technically, both the Nasdaq and S&P are still under key resistance but look to be forming very bullish flag patterns here and that is exactly what I had hoped would happen this week.   Ideally, the next two days would be quiet (and they may be due to Rosh Hashanah) with slightly lower prices.   I would love for the market to be slightly oversold short-term going into next week - I think it greatly increases the chances of a true, more intermediate-term move higher occurring.   Support levels from yesterday haven't really changed - Tuesday's lows are now the closest support but a pullback lower would not necessarily be a bad thing.

S&P 500
Charts from Telechart, Courtesy of Worden Brothers, Inc.

I am still in cash but am looking closely at long candidates as the market is painting an overall bullish picture.   If tomorrow is slow, I may wait, but depending on the stock, I may look to put a few positions on at the end of either of the next two days.   After putting three posts together yesterday, I don't have much else to say right now - things looks good overall - so I will end here.   Take care and good luck Thursday.