The bulls have been weak on Monday’s and strong on Tuesday’s as they made it 14 in a row yesterday. The recovery to prior support levels was encouraging for the major indexes but Gold continued its slide following a back test to $1,400.
The Dow zoomed 157 points, or 1.1%, to close at 14,756. The close above 14,700 was reassuring and the high was 14,761. Despite all the gloom and doom, the blue-chips are just 1% away from historic highs again. The 14,600 level is still shaky support.
The S&P 500 added a double-deuce (22 points), or 1.4%, to settle at 1,574.57. The bulls did clear the 1,575 level and the close was close enough for government work. However, a dip below 1,560 or a close below 1,550 still needs to be watched as warning signs further weakness is ahead.
The Nasdaq jumped 48 points, or 1.5%, to finish at 3,264. Tech was able to clear the 3,250 level again and reached 3,265 but the bulls will need to clear 3,275 on the close if they have ambitions on reaching 3,300 again. If 3,250 fails again, the 3,200 level will likely come into play again.
The Russell 2000 popped a sweet 16, or 1.8%, to end at 923 and he close above 920 again was bullish. Meanwhile, the S&P Volatility Index ($VIX, 13.96, down $3.31) fell nearly 20% and close back below 15. A break below 13.50 would be bullish for a continuing rally.
We have added some possible new trades to the Watch List this morning as we get ready for our next batch of trades! These option trades could become official recommendations at any time so stay ready. If they do take action this morning, we will send out a Trade Alert.
As we head to press, futures looare showing another rough open: Dow (-88); S&P 500 (-10), Nasdaq (-19). Subscribers, check the Members Area for the updates.