Confusion And Chaos
After a confusing and chaotic day yesterday, S&P futures this morning were 1500 higher at 1377.50 on positive election news. 1373 was yesterday’s high.
On the upside, we see 1377.50, which is a major level, 1381.50 and then 1383, which is a key area which the buyers defended strongly on Friday until 2:15 p.m., when the market broke from that level. Then we have 1385 and 1389.
On the downside, we have 1373, 1370.50, 1368, 1363.50, 1362.50, which is also a key area which buyers defended yesterday, and then 1358.50, another key at 1356.50, 1353.50, and a major at 1351.
NASDAQ is suffering from a severe case of whiplash as we rallied 240 handles off the low yesterday only to reverse by 170 handles into the close in one of the strangest closes we have ever seen. That final 30 minutes adds to the absolute confusion.
This morning we’re limit up, plus 95 handles at 2922.50. The simple facts are we’re in relative uncharted territory, making support issues difficult and, secondly, there is still the uncertainty of the political situation, which makes every news event that much more important.
The market did show one good characteristic yesterday, and that was it seemed buyers were just waiting on the sidelines until that first move up. Once that occurred, they piled in. Normally that would have set up for a fantastic closing on the NASDAQ, instead we broke 170 handles.
For today, we see a key level — above limit up — from 2950 to 3000. If it gets above 3000, it has a pretty good chance for 3080; 3020 to 3035 is resistance, and above that 3070-3085.
On the support side, we see 2900 to 2883, and under that 2850 to 2835. If we get below this level, look for the market to continue to sell off, looking for 2755, which was yesterday’s low. Along the way, we have 2805 and 2792. If we were to break yesterday’s low 2710 to 2690 should hold.
Do you have a follow-up question about something in this column or other questions about trading stocks, futures, options or funds? Let our expert contributors provide answers in the TradingMarkets Question & Answer section! E-mail your question to questions@tradingmarkets.com.
For the latest answers to subscriber questions, check out the Q&A section, linked at the bottom-right section of the TradingMarkets.com home page.