David Chojnacki S1F Market Technician
The Market moved to the downside right from the opening bell yesterday. Accelerated selling in the last hour put the major indices at losses between 1.7 and 2% for the session. Breadth was negative, 5 to 1, on another below average volume session. The DJIA and S&P have managed to close above the trading range for the third straight day. They were not able to remain above the 50% retracement level, which is 1236 for the S&P and 11722 for the DJIA. Near term and short term technicals continue with the upside bias, but a test of April and July highs will require the indices to maintain the 50% level. A spike of 10.1% in the VIX yesterday, did nothing to ally the volatility fears that have been in the Market now for months. Look for the S&P to find support near 1220-
1226 area, with resistance in the 1263-1275 levels. The DJIA will see support at the 11613 level and resistance is near the 11965-11967 area. The Russell 2000 closed at 713, dropping back below the range top in yesterday’s session which is 728. The Nasdaq100 participated in the 2% pullback, but managed to hold the 2300 and 2288 levels, which are key support for further upside moves. Earnings reports have been mixed and are having near term impact on Market direction. Europe continues to weigh on the Market and news from across the ocean has been all over the place. The amount of noise in the headlines is contributing to the continued volatility. Early futures this morning are pointing to a positive open.
Major Economic Reports TodayDurable Orders-8:30am New Home Sales-10:00am Crude Inv.-10:30am
ALL PRICES NOTED IN THIS PUBLICATION ARE AS OF THE CLOSE ON TRADING PRIOR TO TODAY’S DATE, UNLESS OTHERWISE INDICATED
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