The market continued its rally today with the S&P closing up 1.79% and reaching new all time highs. The Nasdaq led and gained 2.59%, and it is now only about 2% away from its all time highs after the recent 10% correction it had. The Russell 2000 also jumped 1.85% as oil prices continued to fall and yields pulled back which benefits small caps as odds of rate cuts increase. However, even with the big market rally today the VIX closed up about 4%.
After the close AMD reported earnings which blew past estimates, however their capex spend came in way above estimates ($808M vs $298M) which hurt their FCF (free cash flow). The stock is being punished on this after hours as it currently trades down nearly 9%. SpaceX (SPCX) also reported their first quarterly earnings report since its IPO and they had a strong double beat of $7.8B in revenues vs $6.93B estimated and -$0.09 EPS vs -$0.26 expected. However, the stock is also selling off about 8% as valuation concerns still remain.
The Nasdaq had a strong finish with a close above yesterday's uptrend resistance, which starts another primary daily uptrend (white) for it. The problem right now is the move the last few days has been pretty parabolic and the Nasdaq will have to once again gap up tomorrow to open above its new primary uptrend which will be at 26,775-26,800. That level is about 0.7% above today's close of 26,584. If it can't get that big gap up again, its primary uptrend at 26,775-26,800 will act as resistance on a rally attempt. If it can get that gap up again, there would be more resistance from its prior uptrend (blue) right around 26,800. After that, the last daily resistance will be from the top of its primary uptrend (white) around 27,350.
Odds are it won't get the gap up required to open above its new primary uptrend tomorrow. That doesn't mean it's bearish, it just needs a breather after the big rally the last few days. If there is no gap above its primary uptrend at that 26,775-26,800 level then it will be the first resistance to watch. On a pullback, the first support to watch will be from its prior uptrend (blue) at 26,250-26,275. If that doesn't hold, the last support that would be in play would be from its next uptrend (yellow) at 26,025-26,050.
The S&P also broke above its previous primary uptrend to start a new primary daily uptrend (white) for tomorrow. It also broke through both of its weekly resistances during today's rally (see the weekly update). So while it remains bullish here, there is room to pull back and take a breather after this big move the last few days as the S&P is already at the top of its new daily range.
For tomorrow, its new primary daily uptrend (white) will be the only resistance to watch at 7,800-7,805 which is almost 1% away from today's close of 7,736. Assuming it doesn't get a big gap above the 7,800 level tomorrow, that area will act as resistance on another rally attempt.
The first support to watch will be from its prior sideways range (blue) at about 7,640. If it doesn't hold, the next support would be at about 7,585 from its next sideways range (yellow) and finally its primary uptrend (white - bottom of the range) would be the last support to watch at about 7,530. However, none of these levels may actually get tested. We may just see the markets take a breather and trade sideways for a couple of days within this new primary uptrend.
The Russell 2000 also had a strong breakout above yesterday's primary range. This now starts a new primary uptrend for it, but similar to the S&P and Nasdaq, there is room to pull back in it or at least chop around a bit. For now the only daily resistance to watch will be from its new primary uptrend (white) at about 3,075.
On a pullback, this primary range will also be the first support to watch at 3,000-3,005. If it doesn't hold, the next and potentially last support in play for tomorrow would be from its prior sideways range (orange) at about 2,985.
