NASDAQ is still trading sideways within our pitchfork support and resistance levels. There is no clear downward impulsive move and therefore we assume that this sideways move is corrective relative to the up trend that started from 2600. We think it is more possible that the resistance at 2765 will be overcome and the index will reach 2800. Support is found at 2700-2690 area as mentioned in our previous post were we discussed the island reversal that occurred due to the earnings announcement from APPLE. The up move above 2765 may delay until the Slow stochastic moves away from the overbought area.
The larger picture for DOW shows that the up trend remains intact despite the recent volatility which was part of a sideways wave 4 and not the start of a bigger downward correction. This will be confirmed as long as prices remain above the 13850 level. If this support is held, then it is very likely that this index will continue higher to new all time highs.
S&P has a similar picture as the DOW. The crucial level that bulls have to watch out for is 1495 cash. Below that level prices could accelerate much lower. If this level holds, then prices are to reach 1525-35 area. If we ignore the last 2 sessions as part of a corrective wave 4, then the sequence of higher highs and higher lows remains intact. The fact that after a new high at 1513 the market pulled back to new lows at 1495 and then back up again means one thing to us. Strong bullish trend that will continue higher. Our protection is the Monday low.
As always, thank you for taking the time to catch up on my thinking.