Yesterday the market broke through major technical resistance levels on heavy volume.
PRE-OPEN MARKET COMMENTS FRIDAY – I am going to keep this brief. We have a breakout above the D1 down trend line and the 100-day MA. The volume was heavy and we had steady buying into the close. This move is likely to continue.
We have record levels of cash on the sidelines, stock buyback programs and seasonal strength to fuel this move.
Swing traders can buy the SPY on the open today. We will hold without a stop for a week. I would also suggest selling OTM bullish put spreads below technical support on strong stocks.
Day traders should be ready to buy any early weakness. Wait for support and favor the long side. There will be a little profit taking, but Asset Managers will get nervous that they will miss a year-end rally and they will be bidding.
Support is at the 100-day MA and resistance is the 200-day MA.