S&P 500
The S&P 500 rallied after initially falling during the session on Tuesday, as the 2000 level of course had offered quite a bit of support yet again. That being the case, the market ended up forming a hammer which I find as very supportive. With this, I feel that it’s only a matter of time before the market bounces, every time we reach the 2000 handle. On the other hand, if we break above the top of the hammer, center is possible that we go to the 2080 handle.
If we do break down below the 2000 level, I don’t think that it’s quite ready to fall apart though. With this, I would have to wait until we get at least a daily close below there, if not another daily close below there. Ultimately, I think that it’s probably more likely that we will continue to go higher.
NASDAQ 100
The NASDAQ 100 fell during the course of the day on Tuesday, but as you can see bounced significantly as the 4450 level has offered support again. This is an area that has been supportive recently, and as a result I think that if we can break above the top of the range for the day on Tuesday, it’s time to start buying as the market would continue the consolidation that we’ve seen all the way to the 4700 level.
Given enough time, I think that this market will eventually break out but in the meantime I have to assume that the consolidation continues. After all, there are a lot of things to think about right now, and it is the beginning of the year, when most people are starting to put on longer-term positions. I have no real interest in selling this market, at least not until we spend a couple of days below the 4400 level, but at this point in time I don’t things going to happen.
