The markets were lower in the morning as semiconductors were weak again overnight after selling in Korea's KOSPI index which carried over to the U.S. open. However, markets recovered as the Nasdaq closed down just 0.15% while the S&P was also essentially flat with a loss of 0.02%. The Russell 2000 was the laggard today, closing down 0.40%. The VIX also finished pretty flat with a gain of 0.39%, closing at $15.27 but near the low of day. Tomorrow morning we will get CPI data which is the biggest economic data point for the week.
For the Nasdaq, nothing changes again on a daily time frame as it continues to trade within its big primary uptrend (daily). This will continue to be the only resistance level to watch around 28,250 - however it is extremely unlikely that this gets tested.
As I said in yesterday's update, it's much more likely that the Nasdaq breaks through the lower end of its primary uptrend (white) which will be support tomorrow at 27,000-27,025 which is only about 0.70% away now. With CPI data tomorrow morning there is potential for a gap below it in which case that 27,00-27,025 area would then become resistance. This is likely the only support that gets tested tomorrow, but the last one potentially in play would be around 26,500 from its prior downtrend (blue). This is about 2.5% away though, so it's also unlikely.
The S&P did break below yesterday's primary uptrend that was started, but closed back over it for a failed breakdown which starts a new uptrend for it. It wasn't a strong failed breakdown however, so it's not a long signal, and there is risk of a gap below the new primary uptrend (white) tomorrow as well. This will be the first key level to watch at 7,805 which is where the S&P finished today. If it opens above 7,805 then the primary uptrend will act as support on a pullback and the next resistance to watch will be at 7,814-7,815 (orange) which it could potentially gap above as well on the CPI data, in which case it would also become support. After that, the 7,823 -7,825 level would be next (light purple). The same applies for this level if the S&P were to gap above it, it would become support. The last daily resistance to watch will be at 7,830-7,832 from its next 2 uptrends (blue and red) where the 2 intersect.
Now if the S&P fails to open above its primary uptrend at 7,805 tomorrow, then this would become resistance on a rally attempt. If we get a gap down/sell-off on the CPI data the next support to watch would be at 7,715-7,717 (green). If this doesn't hold, it will have a big support level at about 7,705 which is where its next 2 trends intersect (peach and blue). If that doesn't hold either, the last support to watch would likely be from the bottom of its prior uptrend (orange) at about 7,690.
The Russell continues to trade in its big primary daily downtrend which remains the only active daily trend until it breaks one way, so nothing changes again on a daily time frame for it. Resistance from this downtrend will be at 2,845-2,850 on a rally attempt while support will be at 2,665-2,670 from the bottom of the range.
