Bulls Recover From Opening Losses
Seeking Alpha Analyst Since 2011
Bulls Recover from Opening Losses
9:00am (EST)
Following a dip to support, the market rebounded to close in positive territory following good earnings and a better-than-expected Durable Goods number. The bulls have a slight lead for the week but the bears can still win the week with a little effort.
The Dow advanced 13 points, or 0.9%, to end at 15,555 on Thursday. The blue-chips traded down to 15,455 before recovering to reach a peak of 15,560. The triple-digit move off the low and recovery was a good sign but the bulls are still having trouble clearing 15,600. Initial support at 15,500 has been solid but there is still risk down to 15,400-15,350 on a close below this level.
The S&P 500 added 4 points, or 0.3%, to settle ar 1,690. The index tested a low of 1,680.07 and we have mentioned the bulls need to hold 1,680-1,675 or face further risk down to 1,650. The close at session highs sets up another run at 1,700.
The Nasdaq jumped 26 points, or 0.7%, to finish at 3,605. Tech was strong throughout the day but did see a little red, briefly, before pushing a high of 3,606 and recovering the 3,600 level. A test to 3,625 could come if support holds but a close below 3,575 would be bearish.
The Russell 2000 gained 10 points, or 1%, to close at 1,054. The small-caps fell to a low of 1,040.79 on the open and we have mentioned 1,040 as the first wave of support. There is further risk down to 1,025 on a close below this level but the finish back above 1,050 keeps 1,075 in play.
The S&P 500 Volatility Index ($VIX, 12.97, down 0.21) cleared 13.50 after trading to a high of 13.54 but managed to close below this level. There is further risk up to 15 if the VIX closes above 13.50, otherwise, look for the bulls to push 11-10 if they can keep the momentum.
As we head to press, futures look like this: Dow (-34); S&P 100 (-4); Nasdaq 100 (-6). They have been volatile throughout the night and were much worse before the overseas markets opened. Futures were down nearly triple the current quotes before turning positive at 6am before turning lower again. This is suggesting a lower open with weakness to the downside today.
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