David Chojnacki S1F Market Technician
A mixed day for the Market, as we saw the DJIA and S&P falling, while the Nasdaq100 posted a slight gain. It ended the winning streak for the S&P and DJIA at 5 days. Once again we have some mixed signals and discrepancies within the indices. The DJIA and S&P have an RSI near 50 while the Nasdaq100 is a much stronger 60. The DJIA and S&P remain within the recent wide trading range, while the Nasdaq100 maintains its position just above. As we have noted the Nasdaq100 had been the leader during the 2009 bull market, so the exhibition of strength bodes well for the other indices. The S&P and DJIA are below their 50D-SMA and we would want to see a move above this level and out of the trading range to indicate further strength to the upside.
Yesterday’s session also brought them below their .38 Fibonacci retracement level. On the other hand, the Nasdaq100 remains above its .61 retracement level and remains above the recent trading range. Key levels to look at for resistance are 1220-1225 in the S&P. Near term support would be at 1200. For the Nasdaq100 to continue its leadership to the upside, look for it to hold the 2241 to 2244 area. The Nasdaq100 will find some resistance near 2330. The VIX gained 5.6% in yesterday’s session to close at 32.73. The volatility remains fairly high and mixed technical signals suggest that trading strategies should remain ‘near term’. Futures are above fair value this morning and pointing to a positive open.
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