The yield on the ten-year Treasury closed above 4% for the first time this year. I shall not repeat yesterday's discussion but this now becomes one of the most important charts to monitor for how traders are discounting the economic outlook.



Overseas markets are rallying again. The Brazilian index (^BVSP) moved back up 3% on the session and I shall be watching to see whether the index can sail past its historic high achieved just over a week ago.

In overnight trading the Nikkei 225 (^N225) also regained more than 3% and could be on its way towards a testing of the 200-day EMA which lies about three percent above today's close.



It was a roller coaster ride for equities yesterday but most of the broad indices ended in positive territory. After out-performance in Tuesday's session the Nasdaq 100 (^NDX) and Nasdaq Composite (^IXIC) were relative laggards and left rather small range hanging man candlesticks.



The Shaw Group (SGR) mentioned last Friday on the long side produced a nice gain of almost six percent yesterday and could still have further to go. In such circumstances taking profit on half of the position is often the way to go.



Cognizant Technology Solutions (CTSH) still looks vulnerable.



Digital River (DRIV) gapped up on the open and closed above the 200-day EMA on an uptick in volume but now has a clear line of chart resistance to overcome. I shall be watching today to see whether there is sufficient buying power to propel us above this hurdle.



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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