Cisco Breaks The 4 days Lethargy In Nasdaq!

FUNDAMENTAL ANALYSIS
Not much fundamentals at work today as the Dow continue to close sideways on a dropping oil price. The Nasdaq composite took a boost from Cisco today as we have predicted yesterday and headed up 0.77%, the biggest single day gain in 5 days. Wholesale inventories numbers for Dec will be released tomorrow. This number tells us how much inventory is left after December sales and tells the tale of how active retailers had been. Although not a major release, it does hint at the health of the economy and with a complete lack of any market moving news release this week, this may well turn out to be quite important. Expectations are for Wholesale inventories to drop from 1.3% to 0.6%.

TECHNICAL ANALYSIS
Again, no surprise today as the Dow continued sideways to form another step in its staircase formation and the Nasdaq composite continued up towards the 2500 resistance level as expected. Both indices remain in short term overbought condition and looking back at past behaviour, it is unlikely to see the Dow surge to new highs until it has moved sideways enough or even ditch slightly to wear off its short term overbought condition. The outlook for the Nasdaq Composite continue to be extremely uncertain. Even though the Nasdaq composite has moved very near to its 2500 resistance level, the Nasdaq 100 is still a distance from its 1840 resistance level on rising upside momentum. The Nasdaq 100, with its growing momentum and distance from resistance level, may well help to drive the Nasdaq composite beyond its 2500 resistance level. Oil prices has failed to break the $60 resistance level and has started to ditch after taking a bang on the head. Even though it will affect the energy sector negatively, it should help drive the rest of the market up. That is again, another plus for the markets. All in all, my sentiment remains the same... Bullish for the Dow and Neutral for the Nasdaq Composite. (until proven otherwise)



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