DOW Friday closing price - 14712

Mostly because of positive earnings reports, the DOW bounced back from last week's drop to close in the green on 4 of the 5 days this past week. Nonetheless, the previous all-time high at 14887 was not violated or even approached as economic reports continue to show a slow-down in the economy keeping the buying within the recent trading range. The index closed on Friday at the general support/resistance level at 14700 (300 points below the 15000 level) as the traders await further economic news this coming week in the form of the ISM Index on Wednesday and the Jobs Report on Friday.

The DOW did close near the highs of the week and further upside above 14768 is expected to be seen this coming week. Nonetheless, if the index does accomplish getting above 14768 but not above 14887 it will be considered a necessary retest of the high and new selling will appear. As it is, the "sell in May and go away" adage will kick into place on Wednesday, May 1st unless some unexpected good news on the economic front come out this week.

On a weekly closing basis, resistance is minor to perhaps decent at 14865. On a daily closing basis, there very minor resistance at 14719, minor at 14756 and strong at 14865. On a weekly closing basis, support is minor at 14547 and then nothing until minor support is found again 14093 and again at 13981. Below that, there is no support until minor support is found at 12938. On a daily closing basis, support is very minor at 14599 and minor to decent at 14537. Further minor support is found at 14421.

The DOW mostly "spun its wheels" this past week as none of the earnings or economic reports were good or bad enough to generate any kind of definitive statement. Nonetheless, it can be said the chart picture is now mostly clear as the index within the past 6 trading days tested the 50-day MA, currently at 14435, with a drop down to 14444 and with the 14768 high it can also be said the all-time high has either been tested or is in the process of being tested, meaning that the chart picture is now built to where the reports this week will either generate a break of support and the beginning of the seasonal correction or the uptrend will resume with 15000 as the first objective.

To the upside, the DOW shows 1 successful daily close retest of the high at 14756 and possibly a second successful retest with Tuesday 14721 close. Should 14756 be broken on a daily closing basis, the index will likely head up to the 14685 all-time high daily close and probably break it as well. The 15000 demilitarized zone would then become the next objective.

To the downside and on a daily closing basis, the DOW now shows pivotal daily close support at 14537 but more importantly at the 14421 level as it would also represent a break of the 50-day MA. Below that level there is no support until the 14000 level is reached and even then the support there is from previous high closes and therefore considered minor to decent at best. It should be noted that the index still shows multiple intra-week lows between 14382 and 14404 that will act as a magnet if the index falters at this time.

The trend in the DOW is still up so it can be said the bulls continue to have the edge. Nonetheless, the earnings quarter is beginning to wind down and the seasonal trend correction is looming ahead so the edge for the bulls is minimal.

The DOW is likely to show a bit of strength early in the week based on the close near the highs of the week on Friday. Nonetheless, it is highly doubtful that the traders will be aggressive until the economic reports are out. It is likely the ISM Index report that comes out on Wednesday morning will have a stronger impact this week because it is close to an important pivot point at 50 and a worse than expected report (expected at 51) would likely be the trigger for new selling to appear. By the same token, a better than expected report would re-energize the bulls and give them some additional momentum to the upside.

NASDAQ Friday closing price - 3279

The NASDAQ received a slew of better than expected earnings reports causing the index to outperform the other indexes (2.3% versus the other two at 1.2%). Nonetheless, when "push came to shove" the index was unable to make new 14-year highs and ended up with a red daily close on Friday making Thursday's close at 3289 into a successful retest of the high daily close at 3300.

The NASDAQ continues to be in a negative "megaphone" formation and it is likely that this coming week the formation will either be confirmed or negated based on the fundamental reports that come out on Wednesday and Friday.

On a weekly closing basis, resistance is decent at 3294. On a daily closing basis, resistance is minor at 3289 and decent at 300. On a weekly closing basis, support is decent at 3202/3206 and minor at 3161. On a daily closing basis, support is very minor at 3222, minor to decent at 3203, and decent at 3166.

The NASDAQ rallied with a vengeance over a period of 5 days from 3154 to 3301 (147 points) after positive earnings reports came out on GOOG and NFLX. On Thursday it did look like the index would fly to new 14-year highs if the AMZN report came in better than expected, as so many other index reports had. It was not to be, as AMZN did not beat expectations causing the stock to drop $20 in price (8%) which in turn also caused the index to close in the red on Friday and generate what could end up being a strong and successful retest of the 14-year high daily and weekly close should the index head lower from here.

Most of the important earnings reports in the NASDAQ are now out likely putting the index in the same boat as the other indexes awaiting what the economic reports now show.

To the upside, the NASDAQ now shows intra-week resistance at 3301/3306 (daily and weekly close resistance at 3300 and 3294). The index did close near the highs of the week suggesting that further upside is likely to be seen this coming week. Nonetheless, further upside above 3306 would be considered a strong chart positive as no previous resistance is found until the 3500 level is reached. In addition, the megaphone formation would be at risk of being negated unless my evaluation of the chart points on it was wrong to begin with.

To the downside, the NASDAQ has no support of consequence until 3200 is reached, which means that if the index sees follow through to the downside to Friday's red day that the index could drop as fast as it went up.

As with the rest of the market, the NASDAQ will rely on the economic reports that come out this week, Nonetheless, any follow through to the downside on Monday would increase the probabilities chart-wise that a high to this rally has been found.

SPX Friday closing price - 1582

The SPX reversed direction a week ago Friday after last week's successful retest of the 50-day MA, currently at 1550. The index strongly rallied this past week after that retest but failed to make a new all-time high when the index got up to 1592 but was unable to rally the extra 5+points needed to get above 1597. The index did close near the highs of the week so probabilities do favor further upside this coming week, but if the bulls are unable to accomplish rallying the index on Monday or Tuesday they will have to wait for the economic reports to come in better than expected to accomplish the goal.

The SPX did get above the previous week's high at 1588 meaning that a retest of the highs will have been accomplished on the weekly chart if the index sells off this coming week. The index did close in the red and in the middle of the day's trading range on Friday suggesting that further downside could be seen on Monday if the bulls fail to take the index higher early in the week

On a weekly closing basis, decent resistance is found at 1588. On a daily closing basis, there is minor resistance at 1585 and decent to strong at 1593. On a weekly closing basis, support is minor to decent between 1553 and 1555, very minor at 1515, and minor to perhaps decent at 1500/1503. On a daily closing basis, support is minor at 1553 and at 1545. Decent support is found at 1541. Below that, there is no support until 1487/1495 area is reached.

The chart of the SPX is now set with clearly defined parameters, on a daily closing basis, between 1541 and 1593. Any close above or below either one of those levels is likely to be indicative.

To the upside, the SPX shows intra-week resistance built at the all-time high at 1597. In addition, the 1600 level does offer psychological resistance. Other than those 2 levels, there is no other resistance above.

To the downside, the SPX, like with all indexes, shows no close-by support and should the index start selling off below Friday's low at 1577, it could keep heading back down to the 50-day MA at 1550. Stronger intra-week support is found between 1336 and 1339 but it must be mentioned that the area is now considered having multiple lows and should the index get back down to that level the probabilities will favor the support breaking and a drop down to the next support level at 1500 will likely be seen.

Like with all indexes, the SPX direction will likely depend on the economic reports due out this week. It should be mentioned that if the index makes a new all-time high above 1597 it will not be meaningful unless it happens "after" the economic reports come out.

This coming week is likely to pivot around the economic reports that come out. The ISM Index comes out on Wednesday and the Jobs report on Friday and they are both always considered highly important. The ISM Index number is expected to be 51. A number below 50 would be a recessionary number and likely to generate strong selling. It should be mentioned that Manufacturing numbers have been dropping worldwide and the probabilities favor the number dropping as well, especially since last month it was anticipated to come out at 54.2 and it came out at 51. It would not be surprising to see the number come in lower again. The Jobs number is anticipated to come out at 350k and if lower it would show the beginning of a negative trend as last month's number was also lower than expected. Both of these reports will capture the attention of the traders and it is unlikely the indexes will do anything of consequence prior to their release.

It should be mentioned again that the bulk of the important earnings reports has come out and though earnings were generally better than anticipated there were few reports that beat expectations by a lot. Simply stated, the earnings that have come out were not sufficiently good enough to regenerate the uptrend and the bulls need additional fundamental news to go higher. The market has a seasonal tendency to begin correction in May, usually beginning right after the first 3 weeks of second quarter earnings reports, meaning this coming week. As such, the probabilities favor the bears time-wise, but chart-wise the bulls still hold the edge.