S&P 500
The S&P 500 rose during the course of the session on Wednesday, slicing through the 1900 level and reaching as high as 1925. This is a market that looks like it’s ready to go much higher, and if we can break above the 1950 level, the market will then reach towards 2000. However, we are a bit extended at the moment so it would not surprise me at all if we had a little bit of a pullback and saw buyers come back into the marketplace and then try to break above that level. I don’t really have an interest in selling this market right now, but I would consider doing so if we get a fairly exhaustive candle just above as it would be a return to consolidation in my opinion.
NASDAQ 100
The NASDAQ 100 rallied during the course of the session on Wednesday, testing the 4200 level. There is a significant amount resistance all the way to the 4350 level, but quite frankly I feel that now we have entered this consolidation area, we should continue to go higher. However, I recognize that we may need to pull back from time to time to build up enough momentum to actually do so, so at this point in time I feel that the short-term buyers will be running this market.
The market forming an exhaustive candle would be a selling opportunity though, because most certainly we are in a longer-term downtrend. Nonetheless, I feel it’s only a matter of time before value hunters take over, and that might be what we are starting to see now. On top of that, supra banks around the world have suggested that they are going to do what it takes to support the market yet again. In an environment where quantitative easing and liquidity measures are common, quite frankly it’s quite often the case that stock buyers return.
