David Chojnacki - Market Technician
With the Claims Report not all that encouraging, equities quickly moved to the downside at the open. Earnings continue to miss on revenues and TSLA, a crowd favorite, disappointed on their call. The major indices began to break some critical technical levels and this just precipitated the move to the downside. By early PM, the major averages began to find support and they began a slow move to the upside. By the final bell, the indices were off their lows, but closed with significant to moderate losses. At the close, the DJIA lost 0.69%, the S&P fell 0.78%, and the NDX gave up 1.6%. Breadth was negative, 1.4 to 1, on above average volume. RSI's moved to the downside, with the NDX and S&P falling below 50. The DJIA, which is the weakest near term, fell to 36.8. ROC(10's) declined and remain in negative territory. All three major indices continue with their MACD below signal. The ARMS Index finished at 0.74, indicating some strength at the close. The DJIA continues well below its 200D-SMA(17800), and briefly traded below important support at 17400. By the close it managed to finish slightly above that level at 17419. Near term bias for the DJIA remains to the downside. The NDX was the big loser on the day and dropped below formidable near term support at 4550, reversing bias to the downside. It found support intra-day just near its 50D-SMA(4510), but closed below its 20D-SMA(4574). The S&P fell below its 50D-SMA(2097), but reversed before testing its 200D-SMA at 2072. Its near term bias remains to the downside. The VIX spiked up 10% to finish at 13.77. Near term support for the S&P is now at 2072-75 and 2068. Upside resistance is at 2097-2100 and 2112. The NDX near term support is now at 4510, 4500 and 4492. Upside resistance is at 4550 and 4574. Employment report today. Europe is slightly lower in early trade, China up 2.2% overnight. Futures are lower before the open.
Major Economic Reports Today
Employment Report-8:30am Consumer Credit-3:00pm
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