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Should We Buy this Market-Major Indices Support and Resistance Levels(Part 2)

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We have gotten some big moves in the morning but don't get sucked in quite yet.  There are a few things to watch here.  For starters we have posted the updated support and resistance levels for the major indices below.

Why are these support and resistance levels important?  The reactions around these levels tell us exactly how much buying and selling power there is out there.  If buyers show up and push us through prior days highs as well as through key resistance levels, this tells us we have some strong institutional support.  Pushing through these levels and then basing above those price points will give us high probability setups.  When the markets do this for us as well it will help push turbo charge our stock setups instead of acting like a weight.

Not getting through key resistance levels the first couple of times is fine and expected but we must see repeated attempts as well as support levels being held in order to call it a healthy investing environment.

Most of the big moves today are off V shaped moves which are more tricky and more risky to play.  Many of these are making V shaped moves right into resistance which could be setting up as a short.  If these are light volume bounces watch out! 

Our screens our giving us some potentially explosive setups that we can hopefully play later today or tomorrow  but we will see.  We will send out a report to subscribers if they look like they will trigger.

S&P 500-Stopped short of the 50 day MA and yesterdays highs.  The 10 day ma also knocked the index lower

NASDAQ has run right up into the 10 and 50 day moving averages and was turned away by sellers.  A nice sideways consolidation here would be fine.  Would like to see a decent close without to many swings back and forth

DOW-Stopped right at the the 10 and 50 day moving averages.A sideways base would be fine here as long as we stay above the January highs

Russell 2000-The small and midcap names are leading the market higher.  The Russell has jumped abve the 10 and 50 day moving averages.  The next resistance is the 21 day ma.  A close near here along with some basing action would be great.  The buying momentum is definately strongest in these names

Thanks,

globalchartanalysis.com

 

Disclosure: no positions