The Magnificent 7 was all green today led by META which closed up 5.66%. TSLA also rallied sharply and closed up 4.15% after news that they were rolling out unsupervised robotaxis in Austin, Texas. AAPL was still relatively weak, but did manage to close green and the MAGS ETF closed up 2%. This fueled the tech rally as the Nasdaq closed up 0.76% while the Russell 2000 was also up 0.76%. Meanwhile the S&P gained 0.55%. Volatility continued to decline with the VIX finishing down 7.5%.
The Nasdaq was unable to break through its new daily downtrend resistance around 25,600 which is the area I mentioned in yesterday's update to watch out for. It did have a big gap up this morning, well above its prior uptrend (purple) and it didn't break through this level either which is now support. Since it didn't break through either of its daily trends, it doesn't start any new trends going into tomorrow. So the ranges remain the same for the Nasdaq and now its primary downtrend (white) will be resistance at about 25,550 for tomorrow. If it gaps above this level, then that area will act as support on a pullback. Meanwhile its prior uptrend (purple) will be support around 25,350 on a pullback.
The S&P did break through its prior uptrend (purple) but failed to close above it and so this area will still be resistance for tomorrow. It didn't break through its primary support/resistance as those levels are further away, so there are no new trends that get started for the S&P either. For tomorrow the 6,925 area will be the first resistance to watch - which is from the prior uptrend (purple). If it gaps above this level, then it becomes support again. After that, there would be resistance around 6,982 from its primary trend (white). Support is at about 6,788 from its same primary uptrend, however this is very far away and unlikely to be tested again tomorrow (1.8% away) unless there is some big catalyst.
For small caps, the Russell 2000 also closed up 0.76% today - the same as the Nasdaq. However, there's a notable distinction which is that the Nasdaq closed near the highs of the day while the Russell closed near the lows of the day. I mentioned in yesterday's update that I think we'll start to see some rotation back into tech after it has lagged over the past couple of months. Its all time high was set in October while the Russell 2000 and S&P have been making new all time highs over the past few weeks. And usually when things rotate back into tech, its small caps that end up lagging.
Back to RUT's daily setup though, it did have a failed breakout today above its prior daily uptrend resistance. Since it did put in a new all time high, it still starts another uptrend. But, it could potentially open below this new uptrend tomorrow. Support from this new uptrend will be at about 2,715 and it closed at 2,718, so a small gap lower would get it done. If it does gap below it, then that 2,715 level becomes resistance. From there, the next support levels to watch will be at 2,704 (purple), 2,690 (yellow) and then down to 2,640 (purple channel again) if there was a big sell off. On the other hand, if RUT opens above 2,715 then that area will remain as support. In that case, the next resistance levels to watch will be at 2,742 (yellow) and then about 2,767 from the new uptrend.
