David Chojnacki S1F Market Technician
The averages opened up the session trying to hold on to yesterday's gains. While the indices traded in positive territory there was no robust follow through. In the PM, the averages began a slow decline, but held on for a mixed finish, with the DJIA and Nasdaq100 closing at new highs. At the close, the DJIA added 16 points, the S&P lost 1.6 points, and the Nasdaq100 gained 10.9 points. Breadth was decidedly negative, 2.8 to 1, on a drop in volume from the previous session. Closing prices were not a good reflection of the breadth. RSI's continue to rise and once again are approaching over-bought levels. ROC(10's) declined in the session, but remained positive. MACD's crossed above signal for all three indices on the recent positive activity. Yesterday's session had all the aspects of investors cleaning house and preparing cash for new
allocations. We witnessed this type of activity across our trading desks for much of the session. The steep sell-off in Gold and Bond Etf's is also leaving some investors with cash. Despite the fact the DJIA and S&P developed a 'Doji', we still see more near term strength. The DJIA should continue to find support at 13125 and 13000. Upside resistance sets up as 13250 and 13300. The S&P met resistance just near the 1400 level and pulled back to close just negative. The 1400 level will once again provide resistance, along with 1425. Support continues at 1375 and 1363. The Nasdaq100 was able to hold on for a new high and close above the 2700 level. 2700 and 2675 will now become levels of near term support. Look for resistance to set up at 2712 and 2725. The VIX reversed its recent trend and closed up 3.4% to 15.31. Futures are higher this morning versus fair value.
Major Economic Reports Today
Initial/Continuing Claims-8:30am Empire Man.-8:30am PPI-8:30am Net Long-Term TIC Flows-9:00am Philly Fed-10:00am
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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