Nasdaq, DJIA, S&P, Russell 2000 Are Poised to Test Risky Levels

NEW YORK (TheStreet) -- The major equity averages were poised for negative weekly chart profiles a week ago, but the Nasdaq did not close below its five-week modified moving average and this prevented the confirmation of cycle highs for the stock market.

This week traders and investors heard stabilizing comments by our new Federal Reserve Chair Janet Yellen who re-iterated that tampering of quantitative easing would continue as long as economic growth continued as expected, but that the federal funds rate would remain low even if the unemployment rate slipped below 6.5%.

The lack of any negative comments from Yellen re-fueled Wall Street speculation in both commodities and equities.

The year-to-date rebound for gold continued with the precious metal closing above $1,300 the Troy ounce on Thursday up $100 so far in 2014. Gold has been below its 200-day simple moving average since Feb. 11, 2013 and could move above this milestone at $1309.5 as early as today. The weekly chart for gold has been positive with the five-week modified moving average at $1261.2 with my quarterly risky level at $1,385.

Crude oil began 2014 below its 200-day SMA at $99.56 trading as low as $91.24 on Jan. 9 and this week moved back above the 200-day. At the January low oil tested its 200-week SMA, which has been a magnet since mid-2009. After my quarterly pivot at $93.35 was a stabilizing factor, my semiannual risky level may soon be tested at $104.97.

Speculation in the stock market has been even among the major equity averages, but the leaders have been the Nasdaq 100, the PHLX Semiconductor Index (SOXX) and the Dow Utility Average. The Nasdaq 100 and SOXX set new multiyear intraday highs yesterday at 3659.56 and 556.04 respectively, up 1.9% and 3.9% year-to-date. Believe it or not the leader so far in 2014 is the Dow Utility Average up 5.2% which means that investors are looking for the safety of dividend stocks in addition to the more speculative technology and semiconductor names.

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