A better than expected Jobless Claims Report, mixed results from additional economic reports, and mixed results on the earnings front had equities moving lower at the open on Thursday. Stocks traded in a narrow range for most of the session and by the close were mixed and little changed.
The Nasdaq 100 (NDX) had the biggest loss, as Alibaba (BABA) was helping to drag down the index. The Dow Jones Industrial Average (DJIA) managed to eke out a small gain and the S&P 500 (SPX) slipped a bit by the final bell. Volume tapered off in the session. Many traders may have been waiting for this morning’s Employment Report.
At the close, the DJIA was up 37.3 points, the SPX fell 1.8 points, and the NDX gave up 0.7%. Breadth was just slightly negative, 1.2 to 1, on below average volume. ROC(10)’s were mixed, with the DJIA and SPX advancing and the NDX declining. All three indices remain in positive territory.
RSI’s were also mixed, with the DJIA moving up to 65.5. The NDX and SPX fell to 63.3 and 63.8, respectively. The NDX MACD crossed below signal, joining its fellow major indices. That’s another signal that we may be in for some near term weakness. The ARMS index ended at 0.78, a slightly bullish reading.
We have been watching TLT (iShares Treasury Bond) ETF, as it has been trading near a critical support level. On Thursday it fell 1.6%, breaking the 122.50 support.
The DJIA closed at 26186, but traded as low as 26014. Its 20D-SMA is at 25916. The NDX closed at 6901 and traded as low as 6879. Its 20D-SMA is now at 6820. The SPX closed at 2821, and traded as low as 2812 in the session. Its 20D-SMA is at 2799.
The VIX slipped 0.5% to 13.47. It remains low, but off the record low levels of the previous months.
Near term support for the NDX is at 6900 and 6875. Near term resistance is at 6925 and 6950. Near term support for the SPX is at 2812 and 2800. Near term resistance is at 2825 and 2837.
Europe is trading significantly lower in early trade Friday, and U.S. Futures are also significantly lower in the premarket. Major economic reports on tap today include the Employment Report at 8:30am, Consumer Sentiment at 10:00am, and Factory Orders at 10:00am.
The SPDR Dow Jones Industrial Average ETF (DIA) fell $2.06 (-0.79%) in premarket trading Friday. Year-to-date, DIA has gained 5.76%, versus a 5.52% rise in the benchmark S&P 500 index during the same period.
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Dave Chojnacki is the Chief Market Technician at Street One Financial. He provides technical support for the Street One team and also develops individual analysis for Clients as requested.
Dave is a major contributor to the ‘ETF Daily’, a morning newsletter providing clients a daily look at market technicals of the major indices and selected ETF’s. Market trends, support and resistance levels are provided in the daily letter. The Technical portion of the daily can also be found on Seeking Alpha. Mr. Chojnacki has been quoted in a number of industry publications including the Reuters, ETF Trends, Minyanville, Yahoo Financial and Investors.Com.
In addition, Dave assists with desk trading when necessary. He possesses a Series 7 and 63.
Prior to joining Street One, Dave designed and developed I/T Systems for the Insurance and Financial Industries.