Technical analyst Dave Chojnacki of Street One Financial wraps up the trading week with a deep look at the important technicals for the major U.S. averages, as the first week of October looks to end on a bullish note.
Good economic numbers and a passage of the Budget Bill in the House sent stocks soaring in the morning hours on Thursday. Tech stocks were back in favor, and this catapulted the major averages to good early gains.
Later, equities got an extra bump from the approval of the Budget and pushed the major indices higher late morning. The PM session saw equities flatline but they held onto their gains. The Nasdaq 100 had the strongest significant gain, and the Dow Jones Industrial Average and S&P 500 finished with moderate gains.
All three major indices made new record highs. At the close, the DJIA was up 0.5%, the SPX gained 0.56%, and the NDX added 0.97%. Breadth was positive 1.6 to 1, on average volume. ROC(10)s advanced across the board as momentum picked up in the session. All three indices remain in positive territory.
RSI’s moved to the upside, with the DJIA and SPX continuing into over-bought territory. The DJIA finished at 79.5 and the SPX closed at 78.4. The NDX finished at 64.8. MACD is above signal for all three major indices. The ARMS index ended at 0.78, a bullish reading. The DJIA made a new record close of 22775 and hit an intraday high of 22777. It closed a few points above its upper Bollinger Band® of 22769. It remains well above its 20D-SMA of 22338.
The NDX finally made new highs after lagging the other indices recently. Big Techs got a bid and pushed the NDX to a record closing high of 6057. It traded as high as 6059 during the session. The NDX closed outside its upper Bollinger Band of 6052. Its 20D-SMA is at 5964.
The SPX closed at a record 2552, which was its high of the session. The SPX also finished above its upper Bollinger Band of 2545. Its 20D-SMA is at 2507.
The VIX fell 4.5% to 9.19.
Near term support for the NDX is at 6025 and 6004. Near term resistance is at 6075 and 6700. Near term support for the SPX is at 2537 and 2525. Near term resistance is at 2562 and 2575.
Europe is mixed in early trade Friday, and U.S. Futures are also mixed in the premarket. Major economic reports on tap today include the Employment Report at 8:30am and Wholesale Trade at 10:00am/
The SPDR Dow Jones Industrial Average (NYSE:DIA) rose $0.04 (+0.02%) in premarket trading Friday. Year-to-date, DIA has gained 16.98%, versus a 14.98% rise in the benchmark S&P 500 index during the same period.
DIA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #4 of 75 ETFs in the Large Cap Value ETFs category.