S&P 500
The S&P 500 initially fell during the course of the day on Thursday, but we found buying pressure underneath and we ended up forming a hammer as a result. The hammer of course is a very bullish sign and it looks like we’re trying to build up momentum to finally break out above the 2100 level. A move above there becomes a little bit more of a buy-and-hold situation, so until then I think that a lot of traders are going to look to press the area. This means that we could get a bit of back and forth action here, as the market then would find buyers below, especially near the 2080 level from what I can tell. I am bullish of this market, but I recognize that it could be several sessions before and probably get the breakout.
NASDAQ 100
The NASDAQ 100 did very much the same thing, dipping below the 4480 level and finding support. By doing so, we did up forming a bit of a hammer and it now looks as if we are trying to break out to the upside, but have the psychological barrier 4500 to deal with. I believe eventually we will break above there and continue to go much higher but we may need to regroup a little bit and find support below. In fact, I think we have pretty significant support all the way down to the 4400 level, and even farther than that, possibly as low as the 4300 level.
The NASDAQ 100 has been very strong over the last several sessions, and it should continue to lead the way for American indices. However, you also have to keep in mind that there is a lot of noise just below the 4500 level and extending all the way to the 4600 level, so it’s not exactly like it could be an easy move higher. Expect a lot of back and forth type of action.
