S&P 500
The S&P 500 rallied during the session on Tuesday, as traders came back from the Christmas vacation. It’s obvious that the 2275 level is massively resistive, and if we can break above there it would be a very bullish sign. Once we get above there, I feel that the market will then make a relatively quick move to the 2300 level. A pullback at this point should be a buying opportunity as there is so much in the way of bullish pressure, and of course US indices all look very strong. The market cannot be sold, at least not anytime soon as I think there are several areas where the buyers could return, most notably the 2250 level and the 2200 level.
NASDAQ 100
The NASDAQ 100 broke out during the session on Tuesday, reaching towards the psychologically important level of 5000. That is an area that’s going to cause a lot of resistance, but given enough time we should break above it. Once we do, I feel the market should continue to go much higher, perhaps breaking out to the next leg higher over the longer-term. I think that pullbacks should see plenty of support near the 4950 handle, and find buyers yet again as we should continue to see people who have missed the move higher jumping into the market and trying to get involved. I think there’s no way to consider selling this market, there is far too much in the way of support not only at the aforementioned 4950 level, but also below in the 4900 level.
I believe that sooner or later the volume picks up, probably after New Year’s Day, and this should eventually send us to the next leg higher, and possibly the 5225 level above over the next couple of months.
