June 2, 2000. Nasdaq Composite Index closed 3813.38.
Situation shows serious short-covering in the Nasdaq Composite Index. May 17, at 3700, the Nasdaq was over-bought on the short-term charts as noted in my daily commentaries. It dropped like a rock in water until May 24, when it bounced at 3042, below the 20-month moving average, but the Index successfully re-tested that level again at 3159 on May 30 to start last week's rally. The Nasdaq is extremely overbought on 30-minute and 60-minute charts, enough for a sudden drop to 3600. With the exception of Oracle, whose MACD, RSI, and stochastics have surprisingly turned positive, the Nasdaq leaders are rising only half as fast as the Composite Index. The Generals are staying "in the rear with the gear." Today's bounce on the opening and sideways trade all day on heavy volume is a clear sign of DISTRIBUTION. Expect this to be followed by a 200-point drop after Monday. The Nasdaq has managed to stay within its current 3200-4200 trading range after breaking below it twice in recent weeks, but fundamentals do not support any sustained upward move over 3900. Bearish economic data on the TRADE IMBALANCE is coming very soon, and the Justice Dept. is still targeting large-cap Nasdaq-listed corporations for break up.

5-minute Nasdaq chart support
5-period moving average 3804
20-period moving average 3796
MACD 8.03/8.38 negative
RSI 65.98 neutral
STOCHASTICS 72.85/73.50% negative
15-minute Nasdaq chart support
5-period moving average 3803
20-period moving average 3773
MACD 37.99/43.05 negative
RSI 63.78 neutral
STOCHASTICS 87.90/79.65% positive
30-minute Nasdaq chart support
5-period moving average 3800
20-period moving average 3712
MACD 82.75/82.81 negative
RSI 84.34 positive
STOCHASTICS 95.83/95.29% positive, extremely over-bought
60-minute Nasdaq chart support
5-period moving average 3790
20-period moving average 3633
MACD 117.16/98.99 positive
RSI 81.20 positive
STOCHASTICS 97.92/96.47% positive, extremely over-bought
Daily Nasdaq chart support
5-period moving average 3554
20-period moving average 3527
MACD -86.08/-141.09 positive
RSI 48.14 neutral
STOCHASTICS 69.21/49.83% positive, change from last time
Weekly Nasdaq chart resistance
5-period moving average 3610
20-period moving average 3866
MACD -28.19/123.99 negative
RSI 40.29 neutral
STOCHASTICS 24.11/27.14% negative, but improving
Monthly Nasdaq chart support
5-period moving average 3816
20-period moving average 3213
MACD 572.54/536.29 positive
RSI 73.09 neutral
STOCHASTICS 59.78/72.69% negative

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