David Chojnacki S1F Market Technician
The week moved out to good start with the indices moving to the upside right from the opening bell. Buying was steady into the PM hours and a final push in the last hour and a half left the averages with a moderately strong close. At the close, the DJIA gained 0.76%, the S&P moving up 1.1%, and the Nasdaq100, adding 1.3%. Breadth was positive, 2 to 1, on above average volume. RSI's near term, continue bullish with the index in the low and upper 50's for the three major averages. ROC(10)'s rose in the session, with the Nasdaq100 the only index remaining in negative territory. While it was a strong session to the upside, we remain trading within the current range. The averages did close at or near their highs of the session. To reiterate, the Nasdaq100 has been trading mostly within 2600 and 2700, and the S&P between 1375 and 1435. The Nasdaq100 closed right at its 50D-SMA(2664), but remains just below its 200D-SMA(2672). It also closed above its 20D-SMA(2648). We see near term support at 2648-50 and 2661(50%-retracement ). Upside resistance will now present itself at 2672-75 and 2688. The S&P which had been hovering near its 50D-SMA(1414), managed to move and close above. The S&P closed very near the top of the recent range (1435), which provides near term resistance. Moving through this level we find resistance near 1450. Support now sets up as 1419-1425 and at 1409. A move through the 1435 level would set up the index to test the recent high of 1465. In yesterday's session financials remained the leader, reacting to hints that some resolution to the fiscal cliff was nearer. The VIX moved down 3.8% to close at 16.34, remaining relatively moderate. Indices overseas are up overnight and our futures are following their positive sentiment. Futures are higher, early, versus fair value.
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