DOW Friday closing price - 13093

The DOW ended up with another red weekly close in spite of the fact the index was in the green most of the hurricane-related shortened week. Nonetheless, the red close was not indicative as the index was able to keep the red close above a minor but indicative weekly close support at 13090 suggesting the traders are keeping the door open on direction, at least on a weekly closing basis, until after the election results come out. The index did close near the lows of the week and on an intra-week basis further downside is likely to be seen. By the same token, the weekly close next Friday is what will likely decide the short-term direction for the next 2 months.

The DOW has a classic and possibly very indicative reversal day on Friday having tested the previous intra-week high and daily/weekly closing high from May at 13338 and at 13276 respectively with a rally up to 13289 and then reversing to close below the previous day's low. The reversal day suggests that the traders believe that Obama will win the election and that the index is likely to head lower until the Fiscal Cliff is addressed in January.

On a weekly closing basis, resistance is decent between 13232 and 13276. Above that level there is decent resistance at 13593/13610, minor to decent between 13625 and 13669, decent at 13907 and major at 14093. On a daily closing basis, there is decent resistance between 13232 and 13276, very minor resistance at 13413, decent at 13557 and decent to strong at 13593/13610. On a weekly closing basis, support is minor to decent at 13090, minor at 12922, and minor to decent at 12849. On a daily closing basis, support is minor at 13077, minor again at 13046/13057, and minor to decent at 13000. Decent support is found at 12849.

The 200-day MA in the DOW is at 12985 and it is highly probable that line will at least be tested if not broken at the beginning of the week based on the fact that the index closed on the lows of the week and the probabilities favor an Obama win which would keep all the problems facing the market intact as they have been recently. Nonetheless, a Romney win would be considered a market positive and if that happens, the index would likely go higher immediately on Wednesday. The 200-day MA also represents an intra-week support level at 12970 that is chart-wise pivotal as a break and close below that level would open the door for a drop down to the 12700 which is where additional intra-week support of consequence, as well as "general" support (300 points below a major level), is found.

There are no fundamental reasons at this time, based on the negative response seen this past week to the better-than-expected ISM Index and Jobs Report, for the DOW to trade higher. Friday's action will not support traders buying this week until after the election results, and then only if Romney wins.

To the upside, the DOW has no resistance until Friday's high at 13289 is reached. Further resistance of consequence will be found all the way up to 13338. Nonetheless, above that level no resistance is found until 13588/13661 is reached. None of those levels are likely to be seen on Monday or Tuesday.

This coming week it is all about the election. An Obama win will likely take the DOW down to at least the 12700 if not lower. A Romney win will likely take the index up to at least the 13338 level if not higher.

NASDAQ Friday closing price - 2982

The NASDAQ generated a classic reversal day on Friday after having tested the breakdown point at 3037/3040 with a rally up to 3033 and a close below the previous day's low. The index closed right on the 200-day MA, currently at 2980, and on the lows of the day suggesting that if the index closes in the red on Monday the line will be broken for the first time since June 1st and for the second time since January 5th. The chart looks short-term bearish especially since the better-than-expected economic news was unable to generate a sustained rally this past week. In addition, the main stock in the index (AAPL) broke its 200-day MA on Friday and closed on the lows of the day also suggesting that further downside will be seen on Monday.

The NASDAQ has now had 4 red weekly closes in a row and 6 out of the last 7 and it is evident that the index is on a correction of some consequence with last year's intra-week high at 2878 as the first downside objective. The 50-week MA is currently at 2920 and having had a 69 point trading range on Friday and closing on the lows of the day suggests the index could easily get down to that line on Monday or at the latest on Tuesday if Friday's reversal action gets the follow through expected.

On a weekly closing basis, there is minor resistance at 3069, minor to perhaps decent resistance at 3091, minor at 3136 and decent at 3183. On a daily closing basis, resistance is minor at 3020 and again at 3042. Above that level, there is minor resistance at 3069, decent at 3091/3104 and again at 3149. Strong resistance is found at 3183/3182. On a weekly closing basis, support is minor 2908, minor to decent at 2873 and at 2847. On a daily closing basis, support is minor at 2981, minor to perhaps decent at 2961/2970 and then minor to perhaps decent again at 2910. Stronger support is found at 2873.

The NASDAQ did bounce off of the 200-day MA last week after reaching that line on Wednesday of the previous week. Nonetheless, the bounce was considered weak at best, especially since the index was unable to even get above a previous intra-week low of minor consequence at 3037/3040. A stronger bounce off of that line would have been expected if the traders believed that the probabilities of the uptrend resuming were viable. The weak bounce does suggest the index will break the line this coming week and put the index at least into a sideways trend with a bias to the downside.

Intra-week support in the NASDAQ is found at 2961, at 2946 and at 2890/2900. Below that level, there is no intra-week support of any consequence until 2839 is reached. Nonetheless, on a weekly closing basis, last year's high weekly close at 2873 will be a tough nut to crack as the bulls will attempt to support that level aggressively. A close below 2873 would negate all the positive action seen this year and likely put the index into a downtrend. Resistance in the index will be found between last week's high at 3033 and 3040. Nonetheless, the 3000 level will also act as resistance now, even though broken this past week, as that level has been an important pivot point in the past and now that the index failed this past week is likely to act as resistance as well. Above the 3000 to 3040 level, no resistance is found until decent resistance at 3085/3090.

The chart of the NASDAQ looks weak but won't be "officially" weak until the 200-day MA is broken. Nonetheless, the probabilities of that line getting broken this coming week, probably on Monday, are high and that means the bulls will need Romney to win the election in order to turn that negative break around. By the same token, the index will still be in an overall long-term positive mode until such a time that the index closes below last year's high weekly close at 2873.

SPX Friday closing price - 1414

The SPX was the only index that generated a green weekly close this past week but then again only by 3 points making the green close somewhat meaningless. The index did close near the lows of the week and further downside is expected to be seen this coming week suggesting that a new 9 week low will be made.

As of late, the SPX has been mostly a follower and not a leader meaning that the traders are looking elsewhere for clues to what the market will do. Nonetheless, the 1400 level is important and likely short-term indicative as well, especially since the last 2 weeks the low for the week has been 1403 and 1405, suggesting that a break below 1400 would likely stimulate further selling of consequence.

On a weekly closing basis, resistance is minor at 1433, minor to decent at 1460 and decent at 1465. On a daily closing basis, resistance is decent at 1418/1419, minor to decent at 1427/1428 and minor at 1437. Above that level, there is minor resistance at 1447, decent at 1460 and decent to strong at 1465. On a weekly closing basis, support is minor to decent at 1406, minor at 1397 and decent 1370. On a daily closing basis, support is minor at 1408 and at 1399. Below that, minor support is again found at 1392, minor at 1366 and minor to decent at 1358.

The SPX did test successfully the daily close breakdown point at 1428 with a close on Thursday at 1427 and a red close on Friday. It should be mentioned that the 50-day MA is also currently at 1427 meaning that the red close is indicative that the index is still in a short-term downtrend. The index did close on the lows of the day on Friday and follow through to the downside is expected to be seen on Monday with at least a 1396/1403 objective. An intra-day break below 1396 though, would likely push the stock down to 1386 where another minor support is found. By the same token, a break below 1396 will likely push the index down to the 200-day MA, currently at 1376, since the NASDAQ has already reached that line and the DOW is likely to see it this week as well.

The SPX, being the follower that is has been over the past few years, is also likely to get down to last year's high weekly close at 1363 if the indexes continue lower based on an Obama win. The index has good intra-week support between 1358 and 1363 which included the 50-week MA, currently at 1360. To the upside, the SPX now shows decent daily close resistance at 1428 (1434 intra-week). If able to close above 1428 no resistance is found until 1464.

The SPX is not likely to be the key to anything this week as the financial industry is not in the news at this moment. The index will likely follow what the other indexes do, suggesting the index will drop at the beginning of the week and then wait to see how the election turns out before considering any further action.

This coming week is all about the election. An Obama win is likely to keep selling pressure on the market while a Romney will would likely generate a rally. Nonetheless, the probabilities do favor the downside as it has been said that Obama is likely to be victorious. In addition, the market has been in a short-term downtrend since mid September and even better than expected economic news this past week failed to generate any kind of buying of consequence. The Fiscal Cliff, set to go into effect in January, is likely to hang over the market no matter who wins the election but more so if Obama wins.

There are no economic or earnings reports due out this week of consequence so it will all depend on the election and after that on charts. Support and resistance levels will be important immediately after the election and the traders are likely to make decisions on whether those levels hold of break.