The Nasdaq composite looked poised to stage a strong weekly reversal – typical action for a market in a confirmed uptrend. With big-cap techs including Apple ( AAPL ), Nvidia ( NVDA ) (benefiting from fresh bullish analyst comments) and Alphabet ( GOOGL ), which is forming a new base, the tech-rich composite rallied more than 0.6% in Friday afternoon trading.
[ibd-display-video id=2324531 width=50 float=left autostart=true]That well surpasses the S&P 500’s 0.3% advance. At 6494, the Nasdaq composite held a 1% gain for the week, vs. a 0.6% advance by the 500.
Volume is running lower vs. the same time Thursday on both main exchanges. Winners are beating losers on both exchanges by more than a 3-to-2 ratio. That’s bullish for equities.
Earlier this week, McDonald’s triggered a sell signal for those who bought at the stock’s early-April breakout at 130.10 because the stock fell sharply below its 50-day moving average in heavy volume. Watch to see if the biggest restaurant chain by stores and revenue can regain that medium-term support level and set up in a new base.
Back to Apple, the juggernaut in smartphones, personal computers, tablets and digital services has shown disappointing volume in its rebound after getting knocked by sellers hard following its debut of its next-generation phones. You’d prefer to see the stock rise in heavy volume, not in thin trading as seen Wednesday.
While Apple rose 0.7% that session, volume was 14% below average. Contrast that with Apple’s sell-offs on Sept. 20, 21, and 22, in which shares traded hands at paces of 88%, 32% and 62% above the 50-day average, respectively.
With the pullback in Apple extending into Week 5 on Monday, chances are growing that Apple could set up a new base next to its second-stage flat base that featured a 156.75 buy…