The bulls made a little headway in regaining their momentum on Tuesday as Tech and the small-caps held up in an otherwise unflattering session. The first half of trading favored the bears but the afternoon belonged to the bulls although neither side has a distinct advantage going into Friday’s Black Hole synopsis. Make that Jackson Hole, we wouldn’t want to confuse the economists.
The Dow fell 22 points, or 0.2%, to end at 13,103 on Tuesday. The blue-chips tested a low of 13,081 on the open but rebounded to stick 13,147. Resistance still remains at 13,200 and then 13,350 with support at 13,000 followed by 12,800.
The S&P 500 slipped a point to finish at 1,409. The index traded down to 1,405 at the start of trading but reached 1,413 late in the day before settling below 1,410. The S&P has now managed to close above the 1,400 level for 15-straight sessions. Although there has been some intraday dips over the past 3 weeks, this is a bullish sign. However, if this level is cracked on a close then 1,375-1,350 could come quickly.
The Nasdaq added 4 points, or 0.1%, to settle 3,077. Tech dipped to 3,063 thirty minutes into trading but pushed 3,083 a couple of times. The index has closed above 3,050 for 9-straight sessions which is short-term support but will need to close above 3,100 before we say the bulls have the momentum back.
The Russell 2000 was up 4 points, or 0.5%, and finished the session at 814. The small-caps slipped a point on the opening bell to 809 but pushed green the rest of the day shortly afterwards. The index was able to hold 810 but will face a huge test again at 820.
The S&P Volatility Index ($VIX, 16.49, up 0.14) traded up to 16.92 and managed to stay below 17.50 which is a key level we are watching.
We were able to close another winning trade yesterday which was makes us 12-for-our-last-13 since the first week of July. We still have some open positions we are trying to close this week as we wind down our September options.
Our Track Record for 2012 is now at 119-36 (including the Weekly Wrap recommendations) which is why we continue to remind readers that trading is for the long haul. June was not our best month so we are glad to be making up for some of the trades that didn’t go our way earlier this summer. Even better, we should be well positioned to play the market’s next big move which could come as early as Friday.
Futures are showing a bullish open and look like this: Dow (+14); S&P 500 (+2); Nasdaq 100 (+6).