The NASDAQ Composite Index advanced nearly 1% in today’s trading, moving to the 5917 area. As a result of the rally, the Index is now testing the bull market highs. And, given the close near the highs of the session, further upside movement appears likely.
The NASDAQ has essentially been range-bound since peaking at the beginning of March. On a breakout from the trading range, the target becomes the 6,080 area, based on the range breakout. However, initial resistance may be met at 6,000, given its potential psychological value.
The Stochastic has reached an overbought level, but is currently showing no signs of rolling over from the overbought reading. This is another positive sign for the near-term outlook.
Market internals supported the bullish case in today’s trading, as up volume was 78% of total up/down volume, while advances were 72% of total advancing/declining issues.
The best performing sectors in today’s market were Financials, Industrials, Basic Materials and Consumer Discretionary. The worst performers were Utilities and Consumer Staples.
In terms of groups, Broker/Dealers, Transports and Banks were the best performers, while Utilities and Oil Services were the worst performers.
On the downside, initial support is at the April 13th low, established at 5,805. However, key support is near the 5,770 level. As long as this level holds, the broader bias in the NASDAQ Composite Index remains to the upside.
In tomorrow’s trading, Existing Home Sales will be released at 10:00 ET.