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Today's Technical Outlook - 10/24/2012

Market Summary

David Chojnacki S1F Market Technician

When the opening bell sounded, the indices made a rapid decline to the downside on disappointing earnings and news from Spain. Just after the first hour of trading, the indices were near their lows of the day. This time the DJIA and S&P were the weaker indices, as they attempted to catch up with the leader to the downside, the Nasdaq100. At the close, the DJIA moved down 1.8%, the S&P lost 1.4%, and the Nasdaq100 losing 1%. Breadth was decidedly negative, 2.7 to 1, on average volume. RSI's nosedived for the DJIA and S&P, down to the mid 30's, joining the Nasdaq100 at those levels. ROC(10's) remain negative and declined further in the session. The prior session's reversal in the Nasdaq100, left some hope that the other indices would not follow it into weaker short term technical territory. In yesterday's session however, the DJIA and S&P moved below some key levels and are now sitting with a short term bias to the downside. The S&P broke through its 1 year trend-line intra-day, key support at 1425, and could not trade above its 50D-SMA(1434) in the session. Look for support to now set up at 1410 and 1395-1400. Upside resistance is now at 1425 and 1434. The Nasdaq100, while not the weakest index in the session, closed below its 150D-SMA(2683) and closed within striking distance of its 200D-SMA(2650). It closed just a few points above its 50% retracement level(2662). Look for support at 2662 and 2650. Resistance on the upside is 2675 and 2683. The VIX spiked 13.3% to 18.83 as it moved above its 200D-SMA(17.86). The VIX is beginning to reflect the weakness we have seen in the Nasdaq100. Futures are slightly higher this morning versus fair value. StreetOne Financial WEBINAR-Using Low-Volume ETFs For Maximum Impact and Minimum Cost *November 07, 2012 2:00-3:00pm EDT Register here:



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