Yesterday closed out with narrow range doji candles for the DOW and the S & P 500. In the case of the S & P 500, the open yesterday was 2,037.89 and the close was 2,037.05.
Essentially, the market spent all day going nowhere. The other technical condition was that the day was a narrow range day.? The range for the day was 10.71.? The average true range happens to be 21.39.
So yesterday had a range contraction of about 50% of the average true range.
This sets up a few scenarios.? The first is that a doji means indecision.? It can often lead to a reversal in the market.? But, it can also mean there is a pause before a move continues.
The narrow range bar also tells us to expect a range expansion. High volatility will follow low volatility.
From a technical condition another fact is that the S & P 500 is trading right around the mid band on it's daily chart.
Yesterday, it closed slightly above it, so technically it should offer support.? However, if it trades under the mid band, I would expect it to act as resistance.
The mid band is 2,034.08 and is a price level to pay attention to.
Because the S & P 500 dropped under the lower band back on February 11th, a retest of the lower band would not out of the question.
Here are the key levels for the markets.
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VIX:
Major level - 25.00
Minor level - 23.44
Minor level - 20.31
Major level - 18.75
Minor level - 17.19 *
Minor level - 14.06
Major level - 12.50
The VIX closed at 15.24 yesterday, just under the 15.63 minor level.? At this point, 15.63 should still offer resistance, however, watch how the VIX trades around that level.
If it can get above it, it should then act as support.
18.75 and 17.19 should still be resistance.
S & P 500 Cash Index:?
Minor level - 2,078.12
Major level - 2,062.50
Minor level - 2,046.88 *
Minor level - 2,015.62
Major level - 2,000.00
Minor level - 1,984.38
Minor level - 1,953.12
Major level - 1,937.50
Minor level - 1,921.88
The S & P never quite got to the 2,047 yesterday, hitting a high of 2,042.67.
A retest of 2,000 should be the objective if the VIX does in fact rally.
2,031.30 is a minor support level and yesterday's low was 2,031.96.? An open under 2031.30 and it should now act as resistance.
Nasd 100 (QQQ):?
Major level - 112.50
Minor level - 111.71
Minor level - 110.16
Major level - 109.38
Minor level - 108.60
Minor level - 107.03 *
Major level - 106.25 *
Minor level - 105.46
Minor level - 103.91
Major level - 103.13
The QQQ should retest the 106.25 level.? At this point, I would expect 108.60 to act as resistance.
If it opens under 107.03, then this level should act as resistance.
TLT:?
Minor level - 132.03
Major level - 131.25
Minor level - 130.46
Minor level - 128.91*
Major level - 128.13 *
Minor level - 127.34
Minor level - 125.78
Major level - 125.00
128.91 should offer support.? The objective should still be for a move up to 131.25.
GLD:
Major level - 125.00
Major level - 121.88
Minor level - 121.10
Minor level - 119.53
Major level - 118.75 *
Minor level - 117.96
Minor level - 116.41 *
Major level - 115.63
The GLD is sitting right on the minor support level of 116.41.? If this level holds, I would not expect a move up further than 117.19
115.63 should still be the objective.
XLE:
Major level - 65.63
Minor level - 64.85
Minor level - 63.28
Major level - 62.50
Minor level - 61.72 *
Minor level - 60.16
Major level - 59.38
The XLE closed at 61.51 yesterday, so if it closes under 61.72 today, a retest of the 59.38 would be expected.
Having said that, 60.94 and 60.16 should be short term support levels.
Apple:
Major levels for Apple are 112.50, 106.25, 100, 93.75, and 87.50.
Apple is trading right around the 106.25 level.? To move up, Apple would need two closes above 107.81.? To drop, it would need two closes under 104.68.
Apple still has not confirmed a move either way.
Watch list:
Bullish Stocks: ACN, BCR, FB, JNJ, UPS, VMC, ITW, NOC, XOM, LNT
Bearish Stocks: GD, JACK, LULU, BURL, BLUE, SHLD, KR, AZN, ALDR
Be sure to check earnings release dates.
