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Today's Technical Outlook -7/17/2014

Market Summary

David Chojnacki - Market Technician

Equities got off to good start yesterday, but quickly reversed and moved to the downside till the noon hour. Yellen's second day of testimony did not present anything new and had little if no impact on trading. The major averages caught a bid once again in the early afternoon and held on into the close for moderate gains. The DJIA and Nadsdaq100 finished the day with new highs as the recent rally continues. At the close, the DJIA added 0.45%, the S&P added 0.42%, and the Nasdaq100 moved up 0.46%. Breadth was just slightly positive, 1.2 to 1, on above average volume. This was the second straight day of improved volume. RSI's inched up in the session, with the Nasdaq100 maintaining its leadership. ROC(10)'s advanced in the session, with the S&P moving back into positive territory. Technicals remain strong, with only the S&P not hitting new highs recently. The S&P and Nasdaq100 remain with their MACD below signal, and this may just be a lagging indicator this time. We are seeing a pick-up in volume the last two sessions and also seeing choppy action. We will watch the next several sessions to see if this is any indication of a change in direction. The VIX has been somewhat volatile itself recently, however, sitting at 11.00 does not indicate that there is much fear in the market. GLD(Gold) found support yesterday and reversed its recent pullback. A move above 126.50 would indicate the possibility of resuming its recent upside move. Near term support for the S&P is now at 1975 and 1962. Near term upside resistance is now at 1988 and 2000. The Nasdaq100 near term support is now at 3925 and 3912. Near term upside resistance is now at 3937 and 3950. Europe is down in early trade. More problems in Ukraine, as geopolitical issues have not subsided. Futures are lower before the bell.

Major Economic Reports Today

Initial/Continuing Claims-8:30am Housing Starts/Building Permits-8:30am Phila FED-10:00am NatGas Inv. -10:30am

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