David Chojnacki S1F Market Technician
The Market opened the first session of the New Year jumping out of gate like an Olympic sprinter. The S&P moved up 22 points in the first five minutes of trading. After the first hour, the indices began to consolidate their gains and they closed below where they were at the 9:45 mark. The gains on the session were significant with the DJIA up 1.4%, the S&P gaining 1.5%, and the Nasdaq100, the big winner, up 1.9%. Breadth was positive, 3 to 1, and volume picked up, but still just below average. RSI’s moved up to near 60 and ROC(10)’s are positive and advancing. Near and short term indicators remain positive. The DJIA moved through its recent high of 12231 to close comfortably above. Near term support is now at 12300 and 12231. Resistance on the upside is 12400,
12435 and 12500. The July closing high of 12724 is the next major target for the DJIA. The S&P moved back above its 200D-SMA(1259) and through some key Fibonacci levels. The S&P did pullback in yesterday’s session, just as it neared its recent high of 1285. This will again pose near term resistance along with 1288. Support exists at 1275 and 1263. The Nadssaq100 spiked above its 20, 50 and 200D-SMA’s, as they are converged in a fairly narrow area. Expect to see formidable resistance near 2344(Fibonacci retracement level) and also the top of the current Bollinger Band. Look for support at 2312 and 2297. The Nasdaq100 did form a ‘doji’ in yesterday’s session, which is a reversal signal, so we need to monitor today’s reaction. The VIX lost 1.8% in the session, but managed to hold the 22.50 support level. Futures are down slightly versus fair value.
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