THE BOTTOM LINE:
The anticipated upside chart breakout occurred in the shortened week. Bullish sentiment is still moderate and I remain bullish. I'm also just moved into a new office setting and have a more abbreviated commentary than usual.
MAJOR STOCK INDEX TECHNICAL COMMENTARIES
S&P 500 (SPX); DAILY CHART:
The S&P 500 (SPX) chart is bullish, bullish, bullish; this to emphasize how much the pattern looks like the archetypical strong bullish run up. SPX's dip to 1540 support, followed by a rebound to multiyear highs suggest more upside; currently I'd say 1600 is target and next meaningful resistance.
Key near support is bumped up to 1550 this week; next lower technical support is at 1530.
Bullish sentiment continues to hover under a 'moderate' 1.6 on a 5-day moving average basis. Trader sentiment readings at extremes above 2 makes for a very high-risk market. We're not in that area. In a way the 'best' rallies are the ones that traders don't get all that enthused about, a market that's only gradually working higher, climbing the proverbial 'wall of worry'.
S&P 100 (OEX) INDEX; DAILY CHART
The S&P 100 (OEX) Index has a recent strong upward curving trend, keeping OEX comfortably above its 21-day moving average. On a trend momentum basis we can assume a continued strong advance. The chart pattern suggests an archetypical bull move with a minimum projection to the upper end of its bull channel; e.g., to 717-720 currently.
I don't 'measure' any other short to intermediate-term resistance other than the top of the channel. More will be revealed after the 3-day trading break.
Near support is noted at 697, basically following the line of the 21-day moving average. Next support is 690.
THE DOW 30 (INDU) AVERAGE; DAILY CHART:
The Dow 30 (INDU) Average has also broken out above its line of prior resistance by the strong Thursday close. If INDU continues to trade at or (mostly) above 14540 at what was resistance, this pattern suggests further rebound potential such as to/toward 14800.
More than half of the 30 Dow stocks continue to maintain very strong uptrends on a daily and weekly chart basis. The strong move that is being made in a strong seasonal time (spring rallies) suggests upside potential to the 15000 area over time; 15000 'easily' being an upside objective on longer-term charts. On the daily chart seen below, a 'maximum' next bull move to the upper channel line seen here suggests potential for the Dow to get to the 14800-14880 price zone.
My bullish fever is dampened if the Dow starts slipping below 14400; next key technical support comes in around 14260 or the low end of INDU's current uptrend channel.
NASDAQ COMPOSITE (COMP) INDEX; DAILY CHART:
The Nasdaq Composite (COMP) has also had the bullish action of at least so far a 1-day breakout move above a well-defined line or prior resistance at 3260. If this most recent rally packs a punch, there could be a next move to the 3300 area and above, such as to 3350 and resistance implied by the top end of COMP's uptrend channel.
On the subject of COMP's uptrend channel, a couple of closes below 3200 suggests a bearish dip below technical support and points to slowing upside momentum. I've highlighted immediate support simply at the 21-day average, currently 3230.
NASDAQ 100 (NDX); DAILY CHART:
The Nasdaq 100 (NDX) has a bullish chart. The sideways move, with a pattern of rising intraday lows is most often a bullish consolidation before a further up leg. NDX has seen an initial breakout but we'll see what comes after the 3-day trading break but my expectation is for continued strength on balance.
If the most recent rally has 'legs', it's possible for NDX to now move up toward the top end of its bull channel. I've noted potential 'resistance' at 2863 and especially in the 2900 area at the top end of NDX's uptrend channel.
Near support is seen at 2775-2770. Fairly major support should develop on any decline to the 2700 area.
Bullish sentiment is moderately bullish, with 'moderately' the key word. I get alert to the potential for a sharp downside reversal after high extremes of bullish trader sentiment (the CPRATIO line below); e.g., where a "2" reading where total daily CBOE equity call volume double that of total put volume. However, we're far from that so far. The public will get much more bullish than is currently the case before this current bull market has a big reversal.
NASDAQ 100 TRACKING STOCK (QQQ); DAILY CHART:
The Nasdaq 100 (QQQ) tracking stock mirrors the NDX in its minor initial breakout above key near resistance at 68.9. If the Q's continue to move up from the 68.8-68.9 area, a move to the 70 and above is possible. I've highlighted anticipated resistance at 70.3, then up at 71.4 at the top end of the bullish channel. A move this much higher assumes a very strong up leg ahead. I see this as quite possible but timing of how a spring rally unfolds is tricky.
In that I consider up trendlines as very key areas of technical support, a fall for more than a day below 68-67.8 would be bearish.
On Balance Volume or the OBV line is now trending up which is a secondary bullish pattern for volume; with price action being 'first'.
RUSSELL 2000 (RUT); DAILY CHART:
The Russell 2000 (RUT) Index is bullish in its pattern as sideways moves in a major uptrend tend to be bullish consolidations, suggesting a next upside leg to come. A close below 940 not reversed the next day, suggests a deeper pullback to 920-900.
Key near resistance remains 953; a decisive upside penetration of this line suggests a next up leg in RUT that could carry to 980-990. The longer a sideways move the more force to the upside generally once chart resistance is pierced.
Near support remains in the 940 area, with lower trendline support around 920. 900 continues as long-term support.
GOOD TRADING SUCCESS!