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Market Summary David Chojnacki – Market Technician, StreetOne Technical Analysis
Despite decent PPI numbers, equities moved lower in the early goings. The DJIA and SPX tested and moved through their 20D-SMA’s. The major indices did catch a bid mid-morning and they came off their lows. Most of the remaining session was flat. By the end of the day, the major averages finished with small losses. Investors continue to wait for Tax Plan details. Near the end of the day on Tuesday, word came from the Senate that they may include the repeal of the ACA mandate in the bill. This would allow bigger cuts to taxes. At the close, the DJIA was down 30.2 points, the SPX fell 5.9 points, and the NDX gave up 0.36%. Breadth was negative, 1.6 to 1, on average volume. ROC(10)’s declined, with all three major averages remaining in positive territory. RSI’s fell in the session, with the NDX continuing to be the strongest at 65.8. The DJIA ended at 62.8 and the SPX at 58.2. The DJIA and SPX remain with their MACD below signal. The NDX is the only major index with its MACD above signal. The ARMS index ended the day at 1.43, a fairly bearish reading. There was more indecision in equities yesterday. The DJIA and SPX tested their 20D-SMA support, fell below, than managed to close just barely above. The DJIA closed at 23409, while its 20D-SMA is at 23407. The next key level of support is at 23000, where it closes a ‘gap’. The SPX closed at 2578, just above its 20D-SMA of 2576. The next critical support below is at 2544. Its 50D-SMA is now at 2540. The NDX ended at 6293, comfortably above its 20D-SMA of 6211. The NDX continues to remain the strongest of the big indices, despite losses in 3 out of the last 4 sessions. Caution near term. The VIX added 0.78% to finish at 11.59. Near term support for the NDX is at 6250 and 6211. Near term resistance is at 6300 and 6345. Near term support for the SPX is at 2576 and 2562. Near term resistance is at 2597 and 2600. Europe is lower in early trade. US Futures are pointing significantly lower in the pre-market.
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