S&P 500
The S&P 500 initially tried to rally during the day on Monday but found the 2750 region to be far too resistive. We turned around to form a shooting star that of course is a negative side. However, this is a market that has recently broken down and made a “higher high”, and because of that I still believe that we go higher overall. We might be exhausted, and the breakdown below the shooting star might send this market lower, but I think in the end it will present itself to be a buying opportunity. I believe that the market will eventually find buyers underneath, with the 2700 level being a perfect example of an area where the buyers could come back. However, if we turn around and rally above the top of the shooting star for the session on Monday, that would be an extraordinarily bullish sign. We’ve had several bullish days in a row, so pullback would make sense.
NASDAQ 100
The NASDAQ 100 has initially tried to rally during the session on Monday but turned around to form a shooting star. The 7000 level above is massive resistance, and that of course has shown this market to be a bit exhausted. A breakdown below the shooting star should send this market down to the 6900 level, perhaps even the 6800 level. Otherwise, if we break above the top the shooting star, is likely that the market would go much higher, as it would not only break the top of a massive shooting star, and of course the large, round, psychologically significant figure. Because of this, the market should go looking towards the 7200 level eventually. Although I anticipate this market falling back, I believe that a buying opportunity will present itself underneath.
