Burden Of Proof

S&Ps are trading up 12.90 at 1368.90 on the strength of MSFT earnings. Now the burden of proof in these markets is on the Bears.

On the upside, 1370 is a psychological area at this point, which was the high of the Fed cut day. Then we have a key level at 1371.50, 1374.50, and a major at 1376.50, followed by 1380, 1382.50 and 1385.50.

We have key support at between 1364 and 1365, then 1360, 1358, major support at 1356.50, small at 1354 and critical at 1353.

NASDAQ was trading limit up at 2759.50 bid. It appears as though the first key level of resistance will be found between 2785 and 2800. If we were to get above this zone, 2840 comes into play. We have resistance between 2835 and 2850.

On the support side, we expect some light support to be found between 2735 and 2720. If we get below that, look for the market to try to fill the gap which comes in at 2694.50. If this fails, the next move should be down toward 2650. We have good support between 2675 all the way down to 2630.

As for the Dow, we like it above 10,800 and we don’t below 10,400. It’s definitely worth noting that we have many key moving averages lying right on top of each other. Normally, when this happens we have a very strong move in one direction, and we will extend away from those averages. The odds look like it will be to the upside.