Semiconductors were a drag on markets today as the SOXX etf closed down 6.4% while SMH lost 5.4%. This led to tech underperformance with the Nasdaq closing down 0.66% while the Nasdaq 100 lost 1.54%. The Russell 2000 was strong in the morning and reached a new all time high today, but it reversed and closed down 0.39% near the lows of the day. The S&P also fell 0.22%. There was a big bright spot today in the Mag 7 with the MAGS etf closing up 2.4%. Meta was the big winner, closing up 8.8%, after they announced that they would be building a cloud business to sell excess AI compute. This sent other neo-cloud stocks like NBIS and CRWV sharply lower. With today's market pullback the VIX closed up 0.85% at $16.59.
Tomorrow morning we will be getting the next big batch of labor data with the June jobs report. Month-over-month nonfarm payrolls are expected to come in at +114,000 vs the prior month's print of +172,000. The unemployment rate is expected to remain unchanged at 4.3%. We will also be going into a long holiday weekend with the markets closed on Friday in observance of Independence Day on Saturday, July 4th.
The Nasdaq today traded well within its primary range so it doesn't start any new trends for tomorrow. Its prior downtrend (yellow) will again be the first support to watch at on a pullback at about 25,950. Meanwhile if the rally resumes, the next resistance to watch will be at its prior uptrend (purple) at about 26,610. The last resistance potentially in play would be from its primary range (white) at 26,680-26,690.
The S&P also remained within its primary range, so it doesn't start any new ranges for tomorrow either. This morning it got a quick pullback to the 7,445-7,450 level which was the first support (orange) I said to watch for in yesterday's update as that would be a retest of yesterday's daily breakout. It got down to 7,449.63 before ripping to new highs prior to the end of day pullback. This prior downtrend (orange) will again be the first support to watch tomorrow which will be at 7,430-7,435. If that doesn't hold, the last support potentially in play would be from its primary range (white) at about 7,310.
If the rally continues, the first resistance to watch will be from its prior uptrend (blue) at about 7,590 and the last resistance to watch would be from its primary range (white - top of the range) at 7,620-7,625.
The Russell 2000 broke and closed down below its previous primary uptrend today, but it made a higher high so it still starts a new uptrend for now. The problem is that it was a very weak finish, near the lows of the day, and it will need to gap up tomorrow to open back above its new primary uptrend (white). This level will be at about 3,026-3,027 which is only about 0.5% away from today's close of 3,012. So it is very doable, especially with the jobs report as a major catalyst in the morning.
If the Russell does get this gap above the 3,026-3,027 area then it will act as support on a pullback and the next resistance to watch on a continuation of the rally will be at 3,061-3,062 from its prior uptrend (orange). After that, there would be more resistance at 3,068-3,069 from its primary uptrend (white), 3,072 (purple) and then 3,080 (yellow).
If it fails to get that gap above its primary uptrend at 3,026-3,027, or if it opens above it then breaks down below it, then the next level to watch will be at 3,016 from its prior uptrend (yellow). This is also above today's close of 3,012, so if it fails to open that as well then it would also be resistance. After that, the next support to watch on a pullback will be from its prior downtrend (blue) at 2,987-2,988. If that doesn't hold, the same range would be support from the bottom of the range at about 2,942.
