The Key Zone
S&Ps were trading down 530 at 1372.50 in a key zone for this market. On the downside, we have 1371, 1369, 1365, 1363.50-1364, which is critical, then 1361.50 and 1360.
On the upside, we have 1373, which will be key, then 1375, 1380, 1384.50, 1387, and then 1391-1392. This level will be key because it has been support for several trading sessions and was Tuesday’s low.
NASDAQ was trading up at 2801, up 4.00. The area from 2685 to 2660 is a gap from earlier this week. On the support side, the first key level is going to be 2790 to 2775. This will include yesterday’s low of 2785. If we break through this, look for a move down to 2720. We have support between 2725 and 2715.
If we take that out, limit down comes into play at 2702. If this fails to hold the market, we should fill that gap at 2685-2660.
Resistance is between 2815 and 2830. This zone is important because it incorporates yesterday’s limit down price, and also the high end of the range after we traded to the limit yesterday. If we get above 2830, look for a move to 2870. We have resistance between 2860 and 2875. Above that we have a good chance of moving to the 2950 level.
The Dow should open significantly lower on the heels of an earnings warning from CMB. We still expect the market to stay in a range between 10,500 and 11,000.