The rally continued yesterday but the volume was more subdued. QQQQ, the Nasdaq 100 proxy registered just two thirds of its average daily volume. As the chart below for the Nasdaq Composite index (^IXIC) shows the index has made a resilient recovery since the downthrust on June 7, but we shall be watching today for possible evidence that a lower high could be in the process of forming on this index.

The banking index (^BKX) stalled at the intersection of the 20- and 50-day EMA's in yesterday's action.

The exchange traded semiconductor sector fund IGW is approaching the recent highs. The stock gapped up on the open but we were not too impressed with the below average volume.







TRADE OPPORTUNITIES/SETUPS FOR FRIDAY JUNE 15, 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.

Earlier in the week we noted that Fastenal (FAST) could run into selling pressure as it approaches $42. The star formation from yesterday may be a precursor to further weakness following the recent pullback channel.



We also will repeat another of our suggestion that General Mills (GIS) could provide an opportunity on the short side at $60.



Maxim Integrated (MXIM) has almost completed the move up towards $33 as suggested in our commentary earlier this week.



Parker-Hannifin (PH) has a second small doji star formation at the $100 level and there is a possibility that lower top could about to be registered.



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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