The markets were mixed on Friday with the Nasdaq and S&P both up about 0.2% while the Russell 2000 closed down 0.6% despite yields and oil being lower on the day. The VIX continued its decline to finish at $15.32 for a loss of 2.6%. This was the lowest close for the VIX in nearly five months.
On Friday the Nasdaq did have a failed daily breakout as it broke above its prior uptrend but failed to close above it. Since it did make a higher high, it still starts a new uptrend. But it now has several overhead resistances and it will need to gap up above them tomorrow for them to act as support.
The first resistance level to watch will be at 27,035 from its prior uptrend (red) followed by 27,045 (green) and 27,055 (teal). These three levels will all act as resistance unless the Nasdaq can gap above them. If it does gap or break above them, then the last resistances likely in play for tomorrow will be at 27,250-27,260 from its prior uptrend (blue) and its new primary uptrend (white).
If the Nasdaq does fail to open above the resistances mentioned above and gets rejected on a retest, then the first support to watch on a pullback will be from its new primary uptrend (white) at 26,915. If that doesn't hold, the next support to watch will be at about 26,690 from its next uptrend (red). The last support likely in play for tomorrow will be at about 26,625 from its prior downtrend (orange).
The S&P did break and close above its prior primary uptrend and started a new primary uptrend (white), although it wasn't a strong finish and it will also have to now deal with several resistances above it unless it can gap above them. The first level to watch will be at about 7,585 from its prior uptrend (red) that it closed above on Friday. The S&P closed at 7,580, so it's right around that 7,585 level. If it does gap above it, that 7,580 level becomes support. From there the next resistances will be at 7,610 (orange and green), 7,620 (white - its new primary uptrend), 7,630-7,635 (yellow and teal), and the last resistance potentially in play for tomorrow would be at 7,642 (blue).
If the S&P fails to open above the first level (red) at 7,585 then that will act as the first resistance level, and on a pullback the support area to watch will be at about 7,525 from both of its prior uptrends (red and orange - bottom of the ranges) where they intersect. I think getting this pullback is the more likely scenario.
The Russell 2000 closed below its prior uptrend supports, but still starts a new uptrend for tomorrow. Its new primary uptrend (white) will be the only support level in play tomorrow which will be at 2,909-2,910. If the Russell 2000 breaks or gaps below it (closed at 2,919), then it will start a new trend and we'll have to wait and see how it finishes to determine the direction of this new trend.
If that primary uptrend support does hold, and it bounces back from Friday's pullback, then the next resistance to watch will be at 2,955 from its prior uptrend (orange). The next resistance will be from its primary uptrend (white - top of the range) at 2,962-2,963. If it can break through this level as well, the last two resistances would be at 2,985 (yellow) and about 3,000 (blue).
