The markets finished higher again on Friday in a relatively quiet session into the long holiday weekend with markets closed on Monday, May 25th, for Memorial Day. Small caps were the leader with the Russell 2000 gaining 0.91% as yields pulled back from their recent highs. The Nasdaq and S&P both pulled back into the close and finished near the lows of day, but still posted gains of 0.19% and 0.37%, respectively. Meanwhile the VIX finished relatively flat at $16.70.
The Nasdaq didn't break through any trends on Friday, so once again on daily time frame nothing changes heading into Tuesday's session. The first resistance to watch will be at about 26,650 from its primary sideways range (white). If it breaks through those, its last two resistances will be from its prior uptrends at 26,735 (purple) and 26,785 (yellow). On a pullback, its first support will be from its primary sideways range (white) at about 25,675, however this is about 2.5% away and probably won't be tested unless there's a big catalyst.
The S&P had a failed breakout on Friday above its prior primary uptrend, however it made a higher high so it still starts a new uptrend. Its new primary uptrend (white) will be the first level to watch at about 7,472 which is just below Friday's close of 7,473. If it opens above it, the 7,472 level will act as support on a pullback and the next resistance level to watch will be from its prior uptrend (orange) at 7,513-7,514. After that, its next uptrend (purple) will be resistance at 7,534 and the last daily resistance likely to be in play for Tuesday will be the top of its primary uptrend (white) at about 7,548.
If the S&P fails to open above its primary uptrend support at 7,472 then that level will be resistance and the next support to watch on a pullback will be at 7,430 from its prior uptrend (orange). If that doesn't hold, in the event of larger pullback, the last daily support likely to be in play for Tuesday would be at 7,377 from its prior downtrend (blue).
The Russell 2000 continued higher on Friday towards its primary uptrend resistance, but it didn't break through it. On X/Stocktwits I noted that I entered IWM puts at about 2,876 on the Russell, just off of the 2,878 high as it was approaching this daily and weekly resistance, and I took profits during the afternoon pullback as IWM fell about $2 off of its highs. Since it didn't break through that primary range it doesn't start any new trends going into Tuesday's session.
For now, its primary uptrend (white) is really the only range in play for Tuesday with resistance at about 2,917 and support at about 2,855 on a pullback. We'll need to wait for it to break this range to start a new one and go from there.
