The Pivotal Level

S&Ps must get above and stay above 1286 for the outlook of this market to improve. This morning, S&Ps were up 3.00 at 1282.60. It had traded as high as 1291 overnight.

Above 1286, we have resistance at 1287.50, an important number at 1289, 1290.50 and 1292.50, which is a key area where we failed on our biggest rally of the day yesterday. Above that, we have 1296, 1297.50, 1300 and a major objective at 1305.50.

On the downside, we have 1281, 1276 (1276.50 was yesterday’s low), a key at 1272, a major number at 1266.50 and a major objective at 1260. Chances are, this morning, if we stay below 1283, we could test all the way down to 1260.

NASDAQ was trading down 8.00 at 2267. Our high on Globex was 2336. Volume on Globex was pretty strong, with nearly 1200 contracts traded.

For today, we have support between 2250 and 2235. If we get below this, look for a move under 2200. We have support between 2200 and 2190. If this area fails, limit down — which comes in at 2180 — should be reached.

Below limit down, we have good support between 2157 and 2140. We would be extremely surprised to see the market trade below 2100.

First leg of resistance is 2280 to 2300, and above that 2330 to 2345. If the market gets above that level, we have a chance to accelerate and a possible trade to 2400. Any trading above 2400 is good, and could lead to some short-covering rallies, which could take us all the way into the 2500-level. Expect some very fast, aggressive moves.

As for the Dow, it held above the key 10,300 level, settling at 10,319. Essentially, we settled at a 50% retracement of the up move from our October lows of 9654 to our recent high of 10,917. Again, any close below 10,300 is bearish.