Stock market update the day after midterm elections

The Market opened to the upside on Tuesday morning, with no major economic numbers to influence the direction.   The Job Openings number was slightly lower, but still above 7 million. We now have more than 1million more job openings than people unemployed.

All eyes were centered on election and what impacts it may have on equities. After the initial first hour jump, equities leveled off and went slightly lower through most of the session.  The major indices did get a bounce in the last hour and a half finishing near their highs of the session. Volume dropped off significantly from recent sessions. The major averages ended the day with moderate gains, with the NDX leading the way.  The 10YR ended the day at 3.21.

At the close on Tuesday, the DJIA was up 0.68%, the SPX added 0.63%, and the NDX gaining 0.75%.  Breadth was positive, 1.5 to 1, on weak volume. ROC(10)’s advanced in the session, with the SPX crossing into positive territory, joining the DJIA.  The NDX remained in negative territory. RSI’s moved higher, with the DJIA continuing to lead at 52.8. The SPX finished at 48.4 and the NDX at 45.4. All three major indices remain with their MACD above signal.  The ARMS index ended the day at 0.89, a slightly bullish reading at the close.

Near term technicals have improved recently with MACD’s and RSI’s rising.   The DJIA remains the strongest index, as it closed at 25635, above its 200D-SMA of 25117.  It also finished above its 20D-SMA(25255) and its 50% retrace level of 25494. It remains below its 50D-SMA 25866.  The NDX ended at 6988, below its 50% retrace level of 7059. It remains below its 200D-SMA of 7069. It traded right up to its 20D-SMA(7019) in the session, but finished below.  The SPX closed at 2755, right at its 50% retrace level. It remains below its 200D-SMA of 2763. It closed the session above its 20D-SMA of 2734. The VIX finished at 19.91, down 0.25%.  Near term support for the NDX is at 6859 and 6816. Near term resistance is at 7019 and 7069. Near term support for the SPX is at 2734 and 2700. Near term resistance is at 2763 and 2775.  Europe is higher in early trade. US Futures are higher premarket.

The SPDR Dow Jones Industrial Average ETF Trust (DIA) was trading at $258.78 per share on Wednesday morning, up $2.55 (+1.00%). Year-to-date, DIA has gained 5.48%, versus a 4.80% rise in the benchmark S&P 500 index during the same period.

DIA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #4 of 82 ETFs in the Large Cap Value ETFs category.

Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, David Chojnacki, does not endorse or recommend any issuer or security mentioned herein.

About the Author: Dave Chojnacki

Dave Chojnacki is the Chief Market Technician at StreetOne Technical Analysis. In addition, he is Portfolio Manager for Sabretooth Advisors.

Dave develops 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.

Prior to joining StreetOne Technical Analysis, Dave designed and developed I/T Systems for the Insurance and Financial Industries.