David Chojnacki S1F Market Technician
A precipitous fall at the open on Friday was followed by a lackluster sideways trade for most of the remainder of the session. At the final bell, all three major indices were off nearly 0.7%. Breadth was negative, 3 to 1, on below average volume. For the week, the DJIA gave up 0.4%, the S&P lost just 2 points, and the Nasdaq100 managed to gain 0.7%. RSI 's continue strong, but have pulled back from over-bought territory for the DJIA and S&P. The Nasdaq100 RSI remains at a lofty 75. ROC(10's) continue positive, but pulled back in Friday's session. Friday's pullback may be the start of a correction which has been overdue. Technicals indicate
that we may see at least a 4% pullback at this juncture. We'll watch for a follow through in Monday's session. The MACD for the DJIA slid just below signal again, so it's another indicator to keep an eye on. The DJIA sees resistance at 12810 and 12880. Support is at 12724 and 12600. The S&P continues to find resistance at 1353 and 1363. Support lies at 1335 and 1325. The Nasdaq100 which made new 11 year highs last week did join in Friday's pullback, but near term remains over-bought. We find short term resistance at 2575 and 2600. Support is at 2525 and 2512. The VIX spiked 11.5 % on Friday, to rise for the third straight day to 20.79. Need to watch this today.
David Chojnacki S1F Market Technician
Long term, we have now seen the bias turn to the upside. The S&P has yet to close above prior highs, but is poised to do so. Short term bias continues to be positive and we expect that to continue. Near term, there are some indications of a pullback in the offing, as Friday's session may have been the beginning. Indications are that we may see only a 4% correction at this point. Any additional weakness could see us go down 7% before we find meaningful support. This week we see a bevy of economic reports. Good news from Greece this morning has Futures pointing significantly higher. We will have to see if this holds past the open or do we continue Friday's pullback.
|MAJOR INDICESShort term support and resistance level|
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