No, this is not a recycled post from last month. There was once again news of a deal between the U.S. and Iran today after President Trump called off the planned strikes on Iran for tonight. This sent markets soaring and sent oil lower. Yields also fell on the news, leading to small caps being the outperformer today as the Russell 2000 closed up just over 3%. Tech was also strong with the Nasdaq closing up 2.5% while the S&P added 1.75%. Volatility also came back down with the VIX closing down 12.5% at $19.44, though it remains in backwardation for now.
With the strong rally today, the Nasdaq broke and closed above its prior primary downtrend resistance and started a new primary uptrend. Its new primary uptrend (white) along with its prior downtrend (blue) will be the next resistance area to watch at 26,440-26,660 tomorrow where these two trends intersect.
If there's another pullback, its prior downtrend (yellow) will be the first support to watch at about 25,250. If that doesn't hold, its prior uptrend (purple) and its new primary uptrend (white) will both be support at 25,175-25,200 where those two trends intersect.
The S&P also broke and closed above yesterday's primary downtrend, starting a new uptrend for it as well. The first level to watch for tomorrow will be from its prior downtrend (yellow) which will be right around today's close of 7,394. If it opens above it tomorrow, that area will act as support on a pullback, if not it will act as resistance. If it does open above it, or break through it, the only resistance to watch will be from its new primary uptrend (white) at 7,510-7,515.
On another pullback, the first support to watch will be from its prior downtrend (blue) that it closed above today. This will be support around 7,285 tomorrow. If it doesn't hold, the last support likely in play for tomorrow would be from its new primary uptrend (white - bottom of the range) at about 7,267.
The Russell 2000, which was the best performing index today, also broke and closed above its last downtrend which starts a new primary uptrend (white) for it. This new uptrend will be the only resistance to watch at about 3,010 on another rally tomorrow.
If there's a pullback, the 2,885 area will be the only likely support level that comes into play tomorrow. This will be from both its new primary uptrend (white) and its prior downtrend (yellow) that it closed above today. Both of those trends intersect at the 2,885 level.
