This morning PCE came in much cooler than expected and futures ripped higher on the better than expected inflation data as yields pulled back. The markets did look like they would get a relief rally going, but they sold off sharply into the close. The Russell 2000 closed down 0.39% while the S&P also closed lower by 0.25%. The Nasdaq did finish higher by 0.24%, but all of the indexes closed at the lows of the day. With the late day sell-off in markets, the VIX finished higher by about 2% at $16.34.
The Nasdaq continues to trade in its big primary daily uptrend so once again it doesn't start any new daily ranges for tomorrow. The only resistance level to watch for now will be from its primary uptrend (white) around 27,700. However, this is over 3% away and it's increasingly unlikely to test it the longer that this choppy action continues.
On a pullback, the first support will again be from its prior downtrend (blue) at about 26,550. If that doesn't hold, the bottom of its primary uptrend (white) will be the next support level to watch at 26,450-26,475. If it breaks through this support as well, the last daily support for tomorrow would be from its next downtrend (orange) at 26,275-26,300.
The S&P broke above yesterday's primary downtrend but failed to close above it with the late day sell-off in markets. So it ended up having a failed breakout which starts a new primary downtrend (white) for tomorrow. First we'll look at resistances. On a bounce back, the first resistance to watch will be from its previous uptrend (green) at about 7,673. After that, its next uptrend (teal) will be resistance just above that at 7,677. If it can break through both of those, the retest of today's failed breakout (red) would be next at 7,685. After that, its new primary downtrend (white) would be the last daily resistance to watch at 7,720-7,725.
On a continued pullback, the first support to watch will be from its new primary downtrend (white) at 7,650. That is just below today's close of 7,651.54, so we could potentially see a gap below it tomorrow in which case the 7,650 level would become resistance as well. After that, the bottom of its next downtrend (red) will be the next support at 7,626-7,627. If that doesn't hold, the last daily support to watch for tomorrow will be from its previous sideways range (purple) at about 7,592.
The Russell 2000 traded in its big primary downtrend again as it remains near the middle of this big range, so this will continue to be the only range to watch for now as it doesn't start any new ones again. Resistance from this downtrend will be at 2,890-2,895 tomorrow while support will be at 2,710-2,715. Both ends of the range are pretty far and unlikely to be tested again. It's likely that it just continues to trade within this big range for now.
