S&P 500
The S&P 500 fell during the course of the day on Tuesday, breaking the bottom of not only the hammer from the Monday session, but the bottom of the shooting star from the Friday session. While I do recognize that there is a hammer just below current levels, this does look a bit bearish. I believe that the market will probably grind lower, but eventually will find buyers somewhere near the 1950 level to turn things back around. Once we do, that will be a nice buying opportunity but at this point it looks like we are going to drop from here. With this, I believe that short-term sellers will take control, but ultimately this is a market that certainly has quite a bit of bullish pressure underneath.
NASDAQ 100
The NASDAQ 100 fell during the course of the session on Tuesday as well, breaking below the bottom of the hammer from the Monday session. Because of this I feel that this market will probably drop a little bit from here but should find plenty of support somewhere near the 4240 handle. A supportive candle in that area would have me buying this market again, as I believe there is quite a bit of bullish pressure that perhaps we have gone a little bit too far, too quickly.
I believe that eventually we will break above the 4370 level, which sends this market looking for the 4500 level. However, it is going to take a significant amount of time and effort to get there, and I do not anticipate this move happening very quickly. I think it is going to be more or less a slow kind of long-term trading opportunity. Selling isn’t even a thought at this point in time, simply because there isso much in the way of noise just below, and extending all the way down to at least the 4100 level if not the 4000 handle.
