Steadily Higher
S&Ps moved steadily higher today, and traded in the mid-morning well above yesterday’s highs. Currently, S&Ps are around 1342, near the session highs after moving off the 1328 session low.
We continue to think that if NASDAQ futures trade higher and/or steadily from here, then 1366.50 is a realistic target by Friday for S&P futures.
At the same time, this is largely a “dead” trade. Most hedge funds and proprietary desks for institutions have closed up shop for the week. There is little activity in the Pit other than the retail order.
Basically, if you’re long, stay long. But I would think twice before actively daytrading this market. Overall, the market has a positive tone, and only a close below 1315 is bearish.
As for the NASDAQ, only a close below 2405 is bearish. Earlier, NASDAQ futures saw a solid rally off the session lows of 2396, holding 22.00 above yesterday’s low. So far, so good, as the second-tier stocks have exploded, led by JNPR and CIEN. These will need to be the engine to take us to 2650.
Also, the SOX (semiconductor index) would be critical to this market, and it is up 27 at this juncture. The biotechs have rallied back towards unchanged. If they get moving to the upside, we could have an explosion rally.
However, we think the odds favor a large up-move tomorrow, not today. The market is still digesting Friday’s trade.