STOCK BUYING RESUMES AFTER YESTERDAY'S PULLBACK -- DOW REGAINS 26K -- YESTERDAY'S INTRA-DAY LOW PROVIDES A SHORT-TERM SUPPORT LEVEL -- SEMICONDUCTORS LEAD TECHNOLOGY SECTOR TO NEW HIGH
MARKET INDEXES NEAR YESTERDAY'S INTRA-DAY HIGH ... Stocks are making a strong comeback after yesterday afternoon's pullback. The charts below show 30-minute price bars for the three major stock indexes. All three are approaching the intra-day highs reached yesterday. Chart 1 also shows the Dow Industrials back above the 26K level. A close in new highs is of course necessary to resume the uptrend. What yesterday's pullback gave us, however, was a new support level to use as a reference point. For the Dow, that's 25,700. That means that the market's short-term uptrend remains intact as long that initial support level holds. Chart 2 shows that support level at 2768 for the S&P 500, while Chart 3 shows Nasdaq support at 7205. Stocks remain very stretched and it looked like yesterday's downside reversal might be signalling a short-term pullback. Today's strong price action, however, suggests that investors are still in a buying mood. All market sectors are in the black today. A upside breakout by the semiconductor group helped push the technology sector to a new record. Foreign stocks were also strong.
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Chart 1
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Chart 2
