S&P 500
The S&P 500 initially tried to rally during the session on Friday as we got stronger than anticipated jobs numbers, but as you can see the area just below the 1980 level has offered enough resistance to turn the market back around as we fell apart and ended up forming a shooting star. The shooting star of course is a very negative sign, and the selling seem to accelerate later in the day. With that, it appears that the S&P 500 will continue to be a market that should be sold, and with that I have no interest in buying this market at this point in time. Given enough time, I do think that the buyers will return but it certainly seems as if we’re going to have to test the 1880 handle which had been so supportive previously.
NASDAQ 100
The NASDAQ 100 initially tried to rally during the course of the session on Friday, testing the 4375 handle. That being the case, the market looks as if the sellers are continuing to become aggressive. The shooting star at the bottom of the downtrend normally means that we are going to see continuation of that particular downtrend. I think if we can break down below the bottom of the shooting star, we should probably reach towards the 4200 level, possibly even the 4100 level. I believe that given enough time, it’s very likely that this market could even go as low as 4000. The NASDAQ is very sick all of a sudden.
On the other hand, we did break above the top of the shooting star for the Friday session, that would more than likely be a fairly strong sign that we could go to the 4500 level. That level should be resistive as well, so the end of the day I do think that the sellers are going to have their way for the time being.
