S&P 500
The S&P 500 initially rally during the trading session on Thursday but continues to find trouble at the 20 SMA. At this point, I think the market is going to continue to bounce around, but I clearly see the beginning of support near the 2680 handle, and I think that extends down to the 2600 level. So, even if we do roll over from here I think it’s a somewhat limited move. The alternate scenario would be that we break above the 2750 handle, which clears a lot of resistance and sends the market much higher. Longer-term, I believe that we will go hunting for the 3000 level, but it’s going to take a lot of work to get there. At this point, I believe the bottom of the overall uptrend is the 2500 level, so if we can stay above there we will ultimately attract buying pressure on these dips. I anticipate seeing a lot of support at 2600 if we get down there.
NASDAQ 100
The NASDAQ 100 initially tried to rally during the trading session on Thursday as well but turned around to form a shooting star. The shooting star of course suggesting that we are struggling a bit, but I also recognize that the 6700-level underneath is supportive. Because of that, I would anticipate that eventually we should see buyers jump into this market, and I think that the support could extend all the way down to at least the 6200 level. That being said, it certainly looks as if a roll over in the short term is possible, and a breakdown below the 6700 level could have short-sellers coming out for a small move. Alternately, if we can break above the highs of the Wednesday session we should go crashing into the 7000 level above.
