External Events
The equities markets have been heavily impacted by external news events — Microsoft, PMCS and, of course, the end-of-the-quarter trade action that could make for some heavy volume and some unpredictability.
This morning, S&Ps are trading up 5.00 at 1232. This is still just a shade below fair value as we settled yesterday in a sharp down move and just above the cash level. For today, on the resistance side, we think the key is if the market can get above 1236. If we do, we think the upside has some potential, and we should trade back into the heavily traded zone between 1240 and 1241.50.
On the support side, we have a neutral zone between 1233 and 1230. Below this, look for a move to unchanged at 1227, followed by a test of the 1222 level.
As for the NASDAQ, it is trading up 16 at 1815. Expect some confusion in the first hour of trading today. For today, we have big support between 1800 and 1790. If we get below this, the most critical area is 1770 to 1760.
On the upside, we have a neutral zone between 1805 and 1820. Above 1820, we expect the market to retrace some of its down draft from the afternoon highs, and we are looking for a move to our old target, which was met yesterday, of 1850.
The Dow had strong gains yesterday due to
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PowerRating). Not sure if this will have the ability to follow through today. It will be very interesting to watch the money flow this session in the Dow due to the end of the quarter.