S&P 500

The S&P 500 fell on Monday but continues to find buyers every time it drops. To me, it seems as if the 2275 level is offering a massive amount of resistance, so given enough time I do think that we will build up the momentum to break out. In the meantime, short-term pullbacks we should get an opportunity to take advantage of value in the stock markets. This is a market that I believe will eventually break out and reach towards the 2300 level, and then eventually much higher than that. I have no interest in selling, as the 50- day exponential moving average looks very healthy, just as the overall uptrend does. Given enough time, this is a market that I believe will reflect the fact that the United States is doing much better than many other economies.

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Nasdaq 100

The Nasdaq 100 fell initially during the day but turned around to form a bit of a hammer. We have a shooting star from the previous session, though, so I it looks as if the market will continue to struggle in this general vicinity and cause quite a bit of volatility. I believe that the 5000-level underneath it should be massively supportive, as it has been such a large psychological effect attached to it. On pullbacks, I recognize it is value, as we should then reach towards the 5100 level. I have no interest in selling, and I believe that not only is the 5000-level going to offer a bit of a “floor” in the market, but it probably extends all the way down to the 4950 level.

Short-term pullbacks should continue to be the best way to trade this market, I believe that the longer-term buy-and-hold strategy probably won’t work now, just because of all the volatility. However, if you have a long enough time frame, it is possible.

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