A day dominated by the bulls where all the major indices managed to break important resistance levels, making it four consecutive up days for the markets. However, even more important resistance levels block the way right ahead as we see in the charts below. As always, let's start with the S&P.
S&P - Managed to break through both the MA(200) and more importantly, 1115 today which should become the immediate support. Coming up right ahead is 1130, the multi-month resistance which should prove to be a tougher nut to crack.
Nasdaq - Similar story to the S&P in the sense that it managed to break the MA(200) but again, important resistance lies ahead in the way of 2325 which, if anything, is even stronger resistance than 1115 on S&P as its a multi-year resistance level.
Russel 2000 - Nothing new to add here as very similar to the previous two indices.
So, no doubt, a very bullish day which has left the markets close to the top of the multi-month range. Will the bulls be able to finally crack the 1130 level on S&P and 2325 level on Nasdaq? It is going to be hard no doubt but what is going to make it harder is that the markets are at overbought levels. More on that and the strategy to trade overbought markets later in the evening.
Take care and good luck!
Position update: I got out of ROVI for 0.8% loss, added to WBC at 40.05 and started a position in ARUN at 20.10. Along with these, I also hold LDK.
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