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Today's Technical Outlook- 2/27/2012

Market Summary

David Chojnacki S1F Market Technician

A narrow trading session on Friday, to end a week of trading in a very narrow range. The S&P did manage to close at a new high(1365), and the Nasdaq100 closed above 2600, also a new high. At the close, the DJIA was off 1.7 points, the S&P up 2.2 points, and the Nasdaq100 gaining 9.2 points. Breadth was positive, 1.2 to 1, on low volume. For the week, the DJIA and S&P gained 0.2%, while the Nasdaq100 added 0.7%. Any brief pullback continues to be bought and thus we traded in a narrow range consolidating recent gains. RSI's remain strong and in over-bought territory. MACD's remain below signal and indicate that we use some caution at
these levels. Friday's close in the S&P and Nasdaq100 indicates that we may see some more upside before a correction sets in. Resistance for the DJIA sets up as 13000 and 13125. Support is now at 12906 and 12810. With the S&P at a new high, we see 1363 and 1353 levels becoming near term support. Resistance now lies at 1375 and 1388. The Nasdaq100 continues to make new highs and closed above the 2600 level on Friday. Near term resistance is now 2612 and 2625. Support now lies at 2600 and 2575. The VIX closed up 3% on Friday to 17.31, remaining at modest levels.

Trading Trends

David Chojnacki S1F Market Technician

Long term, with all three major indices trading at new highs, the bias remains to the upside. Short term bias continues to be positive, but a long over-due pullback or consolidation should not be ruled out. Some mixed signals near term, as we trade in a narrow range. Pushing through some new highs suggests some near term strength. A 4 to 5% correction in the short term would not be surprising. A heavy week of economic reports, which should help shed some light on the strength of the economic recovery. Early Futures are lower versus fair value, pointing to a weak open.

Major Economic Reports Today
Pending Home Sales-10:00am

MAJOR INDICESShort term support and resistance level

close 12982


close 1365


close 2604

12906 12982 1363 1375 2600 2612
12880 13000 1356 1388 2588 2625
12840 13125 1353 1400 2579 2637
12839 13250 1344 1412 2575 2650
12810   1335 1425 2562 2675
12724   1325 1437 2550 2688
12700   1312   2543  
12600   1300   2525  



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