Wednesday night futures were deep red after President Trump's speech didn't provide much hope or new information on when the Iran war would end. Oil rallied sharply as well, gaining over 10% during the session, and it was looking like the relief rally was over. But dip buyers stepped up again and markets quickly reversed their losses from the gap down and it was led by small caps. The Russell 2000 closed higher by 0.70% while the Nasdaq and S&P were relatively flat with gains of 0.18% and 0.11%, respectively. However, volumes were very light going into the holiday weekend so I would take it with a grain of salt for now. The markets were also awaiting the March jobs report which came out this morning while markets were closed. The report was better than expected as nonfarm payrolls rose by 178,000 vs the estimate of +59,000. The unemployment rate also ticked down to 4.3% vs the estimate of 4.4%. We'll have to wait until Monday to see how markets react to this as they're currently closed for the Good Friday holiday.
With the gap down and rally back yesterday, it was the first real sign of a potential bottom where buyers stood their ground. The Nasdaq, S&P, and Russell 2000 all put in failed breakdowns as they all rallied back to reclaim key supports. For the Nasdaq on Monday, the first key support level to watch on a pullback would be at 21,530 from its new primary uptrend (white) that it started with the failed breakdown. If it resumes the rally, there will be a few resistance levels to watch. The first will be from its prior uptrend (blue) at 22,185 followed by its primary sideways range (purple) at 22,250. Its last resistance would be from its new uptrend (white) which will be right around 22,300.
For the S&P, its new primary uptrend from yesterday's failed breakdown will be support at 6,515 on a pullback. If that doesn't hold then the next support would be from its prior downtrend (purple) at 6,420. If the rally continues, the first resistance to watch will be from its prior uptrend (yellow) at 6,635 and then its primary uptrend (white) comes back into play from the top of the range at 6,690.
The Russell 2000's new primary uptrend (white) from yesterday's failed breakdown will be support at 2,484 on Monday. If that does not hold, its prior downtrend (yellow) would be the next support level at 2,455. It does have several resistance levels above it with the first being at 2,535 from its prior uptrend (blue). This is just above yesterday's close at 2,530. If it gaps above it on Monday, then that 2,535 level would be support. The next resistance will be from its next uptrend (purple) which it got rejected at yesterday. That resistance will be at about 2,546 on Monday. After that, its next uptrend (orange) would be resistance at 2,555 and finally its new primary uptrend (white) will be resistance at 2,572.
