9:00am (EST)
The bulls were enjoying early gains on Wednesday as they tried to crack another level of resistance but by midday, the market was flat and the bears took over. Although the downside pressure wasn’t as volatile as we’ve seen in recent weeks, the market did test support but by the end of the day both sides battled to a draw.
The Dow gained 4 points to finish at 11,410. The index traded to a low of 11,322 while the high was 11,529. We have outlined 11,350 as the key area to watch this week with 11,600 being the next layer of resistance while 11,200 then 11,000 remains short-term support.
The S&P 500 added a point to close at 1,193 after touching 1,208 as a high while 1,184 came in as the low. We have penciled in 1,175 as short-term support then 1,150 with resistance still at 1,200 and 1,225.
The Nasdaq sank a dozen points, or 0.5%, and ended at 2,511. We said a close above 2,500 favors the bulls going forward as they shoot for 2,550-2,600. The bears are pushing a close below 2,500 as they target 2,400.
The bulls are looking for a catalyst to take them higher while the bears are waiting for more bad news so they can get back to business. The bears can almost bank on more rhetoric from overseas and the euro situation while the bulls will be looking for some good news from our President who says he has a new plan to create jobs for America.
Of course, the bulls will have to wait a couple of weeks as Obama winds down his bus tour of the U.S. before zooming off to Martha’s Vineyard for vacation – all on the taxpayers’ bill. Better yet, the lavish tour bus that was built for the road trip cost a million bucks and it was made by our neighbors to the North, Canada. And Martha’s aint’ cheap. So next time he mentions Wall Street’s private jets, we will mention the million dollar bus.
We aren’t sure what the President has up his sleeve but it better be good. This morning’s job numbers were uninspiring and futures were already lower on more euro worries and have gotten worse. Dow futures are down 211 points to 11,170 while the S&P futures are lower by 25 points to 1,164. Nasdaq futures are off 45 points to 2,130.
Given today’s open, our put options should get a bump this morning. Subscribers, check the Members Area for the updates.
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