Next key technical levels for SPX & Nasdaq - Growth vs Value update and Sector and group relative performance rotation matrix

With today’s surprise employment report out, we wanted to update you on the key technical levels for the S&P and Nasdaq, and at the risk of stating the obvious, continue to focus on the more important technical event developing within equity markets, the rotation toward oversold/bottoming cyclicals.

1) MARKETS: Key technical levels for the S&P cash, S&P E-mini futures and Nasdaq 100

  • At the index level, there are two short-term levels that bear watching. The S&P today is pushing above short-term resistance at the March 4 bounce highs at 3130 and the Nasdaq 100 (NDX) is attempting to break out above February 19, all time, highs at 9736.
  • Next resistance: S&P 3259, 3328 then 3394, NDX 9736 (February 2020 all time highs which it is pushing above today)
  • Support: S&P 3100, 3006, 2934 – NDX 9406, 9194, 8810.
  • What would suggest the rally is slowing? Short-term momentum indicators remain positive after turning up again following the mid-April to mid-May consolidation. A -1.48% decline by the S&P would be needed to suggest the rally is decelerating and begin to turn short-term momentum indicators negative.
However, should a pullback develop, our expectation continues to be that it will likely be shallow, short-lived and an opportunity to continue b...

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