The major indexes finished today with returns ranging from 0.1% to 0.7% with the S&P 500 hitting a two year high. Both investor participation and market breadth were good and we guess the market liked what was said from the President and Federal Reserve so far. Not sure we learned anything new from either party. I guess one of the questions going forward is how much of the good news scenario is already built into equity prices? The market will probably tell us shortly. As a result, of the current stock market direction trend we are raising the support levels on the DJIA (DIA), S&P 500 (SPY), and Nasdaq Composite (QQQQ) (see below). In addition, we are raising the resistance levels for the DJIA (back to where it was a few days ago) and S&P 500 (one point above today's close), respectively (see below). For the Nasdaq Composite we are keeping the resistance level (see below) the same. We continue to believe putting money to work to open new positions is risky. We feel there will be ample opportunity to purchase stocks at prices lower than where they are today. Complacency and a lack of fear remain rampant in the market. Even with the run stocks have had there are plenty of stocks that have had significant declines recently so protecting profits by selling into strength and cutting your losses quickly is a good approach to follow.
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