The market opened stronger on Wednesday continuing its climb higher. Housing numbers came in about where they were expected, not having much impact on equities. All three major averages hit new intraday highs during the session, but only the Dow Jones Industrial Average (DJIA) was able to close in record territory. The Nasdaq 100 (NDX) and S&P 500 (SPX) closed lower in the session.
We have seen more companies continue to give bonuses to employees as the result of the tax reform. The manifestations of tax reform continue to show up in the Financial sector especially, as the XLF (SPDR Financial) closed at a new multi-year high yesterday.
At the close, the DJIA added 41.3 points, the SPX slipped 1.5 points, and the NDX fell 0.63%. Breadth was negative, 1.2 to 1, on above average volume. ROC(10)’s declined in the session, for all three major indices. They remain in positive territory.
RSI’s were mixed, with the DJIA remaining the strongest at 85.2. The SPX and NDX fell to 83 and 76.9, respectively. They remain in near term overbought territory. All three MACD’s continue above signal. The ARMS index ended at 0.61, a bullish reading at the close. Volume picked up in the mixed session, which only saw the DJIA close at a record high. Doji’s (candlestick) were prevalent in many equities yesterday, which are a sign of indecision.
The DJIA closed at 26252 and traded as high as 26392. Its 20D-SMA is now at 25464. The NDX traded as high as 6992 in the session, a new record. It was unable to hold those levels and closed at 6919. Its 20D-SMA sits at 6674.
The SPX hit a record high of 2852 in the session, but ended lower at 2837. Its 20D-SMA now sits at 2754. Its upper Bollinger Band® is now at 2861. The VIX added 3.2% to finish at 11.46.
Near term support for the NDX is at 6900 and 6875. Near term resistance is at 6950 and 7000. Near term support for the SPX is at 2825 and 2812. Near term resistance is at 2850 and 2862.
Europe is higher in early trade Thursday, and U.S. Futures are also pointing higher in the premarket. Major economic reports on tap today include Jobless Claims at 8:30am, New Home Sales at 10:00am, Leading Indicators at 10:00am, and the Natural Gas Report at 10:30am.
The SPDR Dow Jones Industrial Average ETF (DIA) rose $1.12 (+0.43%) in premarket trading Thursday. Year-to-date, DIA has gained 6.14%, versus a 6.12% rise in the benchmark S&P 500 index during the same period.