9:00am (EST)
The bulls gave up a lot of ground in the first half of trading but we said to watch for an second half comeback on Thursday. The major indexes were able regain their footing following another test to support but like we have seen with the bulls cracking resistance the bears are having trouble breaking support.
The Dow dropped 32 points, or 0.3%, to finish at 13,944. The blue-chips tested a low of 13,852 and held 13,850 which is what we wanted to see and there is further help at 13,800. The index hasn’t fallen triple-digits all year on a close but yesterday’s 134-point drop is a reminder of the elevator we have warned about. A close back above 14,000 before the weekend would put the bulls back in the driver’s seat.
The S&P 500 slipped 3 points, or 0.2%, to settle at 1,509. The index tested a low of 1,498 and we said to watch for 1,495 to hold but we were hoping the bulls would stick 1,510 on the close. If they can clear 1,513 or at least trade up to or past this level today, there is a good chance next week is bullish.
The Nasdaq also fell 3 points, or 0.1%, to end at 3,165. Tech broke below 3,150 an hour after the open and kissed 3,135 before rebounding. We have said a close above 3,175 would be the next clue for higher prices and Wednesday’s test to 3,174.82 has been teasing us ever since.
The Russell 2000, believe it or not, also gave back 3 points, or 0.35%, to close at 908. The small-caps held 900 after kissing 902 and did trade into positive territory (by a fifth of a point) at the open. Meanwhile, the S&P Volatility ($VIX, 13.50, up 0.09) traded up to 14.41 but held 15 before finishing nearly unchanged.
Futures are showing a nice start to today’s action: Dow (-2), S&P 500 (+1); Nasdaq 100 (+5).
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