David Chojnacki S1F Market Technician
The Market opened flat, awaiting the word from Big Ben. When the news was finally out at 12:30pm the averages took off and never looked back. The indices finished the day near their highs and volume swelled. We moved right through near and short term resistance points as the strength of the rally was widespread. At the close, the DJIA added 1.5%, the S&P tacked on 1.6%, and the Nasdaq100 put on 1.4%. Breadth was decidedly positive, 4 to 1, on above average volume. RSI's popped and the S&P finished at 73.3, indicating that we are becoming somewhat over-bought. ROC(10's) continue in positive territory and advanced in the session. It was another strong session that developed a large 'bull' candle, similar to last Thursday's. Near term strength in the Nasdaq100 improved, however, we see the MACD remain below signal. With the Nasdaq100 at 12 year highs, the weak MACD is just a result of the recent consolidation. The Nasdaq100 now has support at the 2825 and 2800 levels. Upside resistance is at 2850 and we see a short term target at 2882. The S&P also closed in new high territory and is approaching near term over-bought levels. There is resistance at 1462 and 1475 near term, with support now at 1450-1440 and 1425. The short term upside target is now 1504. The S&P is now within reach of its 2007 high of 1576. The DJIA now has near term resistance at 13625, and support at 13279. The 2007 high for the DJIA was 14198. The VIX had a big move down of 11% to 14.05. The VIX is now challenging its recent low of 13.30. We finish the week with a bevy of economic reports and based on this morning Futures, it looks like a follow through on yesterday's strength.
Major Economic Reports Today
Retail Sales-8:30am CPI-8:30am Industrial Prod./Capacity Util.-9:15am Mich Sentiment-9:55am Business Inventories-10:00am
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