Following Monday's strong upward trend session there were some indices that registered further upward progress such as the S&P 500 (^SPC) while many stalled or retreated slightly. The S&P managed to close at another multi-year high as it continues the move towards the previous historic high from March 2000.

As discussed yesterday, the dollar continued to weaken and the British pound pushed right through previous resistance at $2 and closed almost one cent above that level.



Despite recent new all time high closes for the S&P 500, DJIA and Russell 2000, the chart for the Nasdaq 100 (^NDX) has yet to re-challenge the late February level above 1840.



The broker/dealer sector (^XBD) surged on Monday in line with the chart for the mainstream money center banks that we reviewed yesterday. The chart pattern was clearly pointing to this as we commented last week and the revival of the financial sector in convincing fashion since the broad market sell-off from six weeks ago augurs well for the near term direction of equities.



TRADE OPPORTUNITIES/SETUPS FOR WEDNESDAY APRIL 18, 2007

The patterns identified below should be considered as indicative of eventual price direction in forthcoming trading sessions. None of these setups should be seen as specifically opportune for the current trading session.

Novellus (NVLS) saw a range expansion session downwards on increased volume following the inside day from Monday's trading. Yesterday's close saw a break down below both the 20- and 50-day EMA's.



The recent pattern for Ford (F) follows closely the template we have discussed above for NVLS and with the chart for Ford yesterday's close was also below the longer term 200-day EMA as well.



D.R. Horton (DHI) appears to be close to completing a basing pattern with some early indications of positive divergences.



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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