Where Are The Markets Key Support Levels?

Wednesday could be a pivotal day for the market.

With a gap down in the major indices the market continued to sell-off until finding some late-day support, especially in the Dow which closed green.

A key to what happens from here over the next few days could be decided on Thursday.

Citigroup came out and expressed they see a 10% correction adding to the worries of many traders. With frothy conditions, that is understandable.

On the other hand, should Thursday see a higher market, we will most likely also see a new round of buying.

Luckily, by looking at the technical of the major indices we can plan what to expect, and more importantly what to do if the market decides to head lower.

With that said, charting is not a crystal ball, but I believe it is the next best thing.

First let us look at today’s index leader the Dow Jones (DIA), which was able to close at new all-time highs.

Even more, the DIA was the only major index to not break its 10-day moving average at $313.37.

When it comes to support, $211 is an important area to watch as there has been much consolidation from January there.

Next, we have the Russell 2000 (IWM), which closed just a single penny over its 10-DMA at $224.09.

Important support levels to watch are $222 and $214 area.

Technically, IWM had a potential topping pattern. Nonetheless, we have seen that type of pattern many times over the last few months and today’s volume did not indicate extreme fear.

The Nasdaq 100 (QQQ) has the clearest support price to watch.

If you draw a line at $329.50 you can see multiple support points align on the chart.

This creates a pivotal area to watch for support to hold or break.

However, with the price currently back over its 10-DMA at $332.83, the highs are not far off.

Last, we have good old S&P 500 (SPY) holding the price range for the past couple of weeks.

The most recent support comes in at $385 but like the rest of its index friends it is again holding over the 10-DMA at $389.47.

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