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Today's Technical Outlook - 4/15/2013

Market Summary

David Chojnacki S1F Market Technician

After four strong moves to the upside, the major indices opened the last trading day of the week to the downside. By noon the averages began a slow reversal and by the final bell were off only slightly. At the close on Friday, the DJIA gave up just 0.08 of a point, the S&P slipped 4.5 points, and the Nasdaq100 lost 2.5 points. Breadth was negative, 1.6 to 1, on average volume. For the week, the DJIA added 2%, the S&P was up 2.2%, and the Nasdaq100, having a good week, up 3%. RSI's remain in the 60's, with the DJIA moving into over-bought territory at 71.9. ROC(10's) are now positive for all three major indices and advanced in the last session. The S&P joined the DJIA in moving to all-time highs last week. The Nasdaq100 which has been lagging the major indices this year, tested its September 2012 highs. It was a good week for the major averages, as they broke out of a trading range that lasted for nearly 6 weeks. Commodities moved in the opposite direction, especially gold and silver, which dropped significantly last week. Apparently investors are not fearing inflation from the Fed's easy monetary policy and are shunning Gold as a safe haven. The DJIA has been the strongest of the major indices, as money flows to large cap equities paying respectable dividends. Recent economic weakness and earnings could thwart that strategy.

Trading Trends

Technicals continue to support the long term bias to the upside. The DJIA and S&P are now at all-time highs, and the Nasdaq100 is testing 12 year highs. Short term, technicals improved dramatically last week, as the major indices broke out of a six week range. Indices are beginning to confirm each other and MACD's return to the positive side. Near term, upside momentum is beginning to rise again and RSI's are strong. The DJIA is moving into over-bought area and some consolidation near term would be healthy. This week we have CPI and Housing Starts. Investors will be closely watching earnings as they begin to pick up this week. Europe is weak this morning in early trade. Futures are down moderately versus fair value, early this morning.

MAJOR INDICESShort term support and resistance level

close 14865


close 1588


close 2856

14800 14875 1588 1593 2850 2862
14700 14888 1576 1597 2837 2864
14684 14900 1565 1600 2825 2878
14600 14950 1563 1612 2812 2888
14588 15000 1556 1625 2806 2900
14525 15125 1550 1637 2800 2912
14500   1540 1650 2788 2925
    1539   2780 2950
    1525   2775 2962

Major Economic Reports Today

Empire Manufacturing-8:30am Net Long-Term TIC flows-9:00am NAHB Market Index-10:00am



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David Chojnacki S1F Market Technician