S&P 500
The S&P 500 had a slightly positive session on Monday, as we continue to see bullish pressure in the US indices. I believe that every time these markets pullback, you have to think that the Americans are going to jump in and pick up value. I think that the 2350 level will more than likely be supportive, and I recognize that the absolute floor in the market is somewhere closer to the 2300 level. Pullbacks offer value, and of course having said that we are a little bit overextended. Because of this, I think we will have a choppy move to the upside from here. After all, being overextended makes it a little bit difficult to put a lot of money into the market.
NASDAQ 100
The NASDAQ 100 pulled back a little bit during the Monday session but found support underneath. It looks as if the 5300 level is trying to offer a little bit of a floor, but we are still overbought and I believe that at the very least we need to find a little bit of consolidation in order to build up enough momentum to go higher. I think that the 5175 level underneath is going to be very supportive, but quite frankly I would be very surprised if we get anywhere near there. I believe that the market will continue to attract a lot of attention as it has in the past, and essentially the NASDAQ 100 has been the primary driver of American indices higher, not to mention all the other indices that have been coming right along.
I have a longer-term target the 5500, but it’s going to take a while to get there. The buyers of course are being a little bit complacent, so we could end up having a nasty pullback. Don’t let that dissuade you from buying on support below though.
