Stocks were higher yesterday, with the finishing up about 80 basis points to close at 3,446. The market managed to gap higher above the 3,425 level, advancing to 3,445. It’s an essential level of resistance. It’s the Fibonacci 61.8% retracement level from the Sept. 2 highs to the Sept. 24 lows. It could be one reason why we were kind there all day and were unable to advance.
The market is in an interesting spot because it is trying to break out of a trading range. However, we really need to see a strong follow-through on Friday, Oct. 9, to confirm that we are breaking out and likely to head higher back to the 3,560 level.
At this point, I don’t have enough evidence to support that notion. However, if we have a higher day again today, we can begin to look for higher prices.
The NASDAQ 100 (NASDAQ:) wasn’t as successful yesterday; it actually finished the day right below technical resistance at $282. This is a crucial level of resistance that dates back to Sept. 9. It was almost the equivalent of the resistance level in the S&P 500 at 3,425.
However, if the Qs cannot penetrate that $282 level, it would leave the question open as to whether or not the S&P 500 actually broke out today. It could just as quickly turn out to be a failed breakout when we start trading tomorrow.
It wasn’t a great day for Apple (NASDAQ:) with the shares trading sideways, and finishing the day lower by 10bps. The stock is just stuck at resistance, and it is hard to imagine the market moving significantly higher without Apple. I just don’t see Apple breaking out yet. Not based on what I have seen in recent days.
Amazon (NASDAQ:) didn’t rally yesterday either. Again, it is going to be hard for the market to rally much without Amazon also.
Intel (NASDAQ:) is starting to break out and is now moving beyond resistance at $52.20. The RSI is picking up momentum, which means the stock is likely heading back to $56, with the potential for a gap fill at $60.