It was another roller coaster ride in yesterday's trading but within a relatively narrow range. The inside formation that is apparent on the chart for the Nasdaq 100 index (^NDX) as well as the doji pattern captures the indecisive flavor of recent sessions well. Options expiration seems to be an important contributory factor to the hesitation and the news-flow regarding CDO's and related difficulties amongst the financial sector continues to weigh on sentiment. As I have discussed before, the injection by sovereign wealth funds in the ailing US banking system is an excellent example of the interdependencies in the global economy and tempers my willingness to embrace the more apocalyptic scenarios being peddled by some pundits.



Over the last three sessions the Dow Jones Industrials index (^DJI) has closed within a very confined range and in close proximity to the 200-day EMA. I will be looking for the logjam to break in the next two sessions and would not be surprised to see the bulls trying to run in the early going today buoyed by the strong Oracle report from late yesterday.



Smith International (SII) managed to break free of an area of chart congestion on above average volume and a short term target of $74 is feasible.



AT&T has pulled back to probable support at the convergence of the two shorter term moving averages.



Charles River Labs (CRL) has performed well following the bull flag that evolved in early November. The recent dissipation in momentum and money flow suggests that a period of consolidation is imminent



Commscope (CTV) is at a potential breakout point but has to pull away from all three moving averages.



Following the suggestion from yesterday Fuwei Films (FFHL) delivered more than a six percent return and despite the strong move it still remains within the pullback pattern.



Clive Corcoran is the publisher of TradeWithForm.com, which provides daily analysis and commentary on the US stock market. He specializes in market neutral investing and and is currently working on a book about the benefits of trading with long/short strategies, which is scheduled for publication later this year.

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