DOW Friday closing price - 21636
SPX Friday closing price - 2541
NASDAQ Friday closing price - 7502

The indexes generated a recovery rally of between 9% and 12% (depending on the index) but the rallies fell short of negating the bear market signals given the past few weeks, with the indexes falling short of closing above 23564 in the DOW, above 2714 in the SPX and above 7870 in the NASDAQ, with those being the levels needed for negation to occur. Nonetheless, all indexes closed in the upper half of the week's trading ranges, suggesting further upside above last week's highs will occur this week (DOW above 22596, SPX above 2637 and NAZ above 7809), suggesting one more try will occur this week

The reason for the rally this past week was the $2.2 trillion financial aid package as well as the Fed opening the doors to all available-to-them stimulus actions, which did inject enough confidence in the traders after the big drops to do some short covering and bargain basement buying. Further confidence was also obtained when the President stated he was looking to withdraw some of the solitary isolation orders in those cities that are not as affected as the big cities are, thus stimulating some return of the economy to some form of normalcy. Nonetheless, and from a purely chart perspective, all those action did no more than stop the downtrend for the meantime until new information about how severe this virus will affect the economy.

From a purely chart perspective, the indexes seem to be in a temporary trading range between the recent lows (DOW at 18213, SPX at 2191 and NAZ at 6631 and the 20% bear market resistance areas stated above. By the same token, it is important to understand that the support levels below are on an intraweek basis while the 20% bear market areas are on a weekly closing basis. The trading within this range is likely to be in effect for at least the next 2-4 weeks while the numbers of the economic damage are evaluated. This week, there are 3 economic reports of importance with the Consumer Confidence number coming out on Tuesday, the ISM Index number on Wednesday and the Jobs report number coming out on Friday. Expectations in Consumer Confidence are a number of 109, ISM Index expected at 43.3 and Jobs at -180K. All expected numbers are very low and negative to the economy, but evidently if expectations are beaten to the upside, some buying will occur and the opposite is true. By the same token, these numbers are the first given since the Virus took hold of our nation/economy and therefore not as indicative as the numbers that will be given the following month, suggesting that whether they are better or worse, it will not be enough on either side to break above resistance or break below support. Next month's numbers will be more indicative. I would venture to say that the Consumer Confidence number might be the most important one as it shows what investors are projecting for the future while the other numbers show what has already happened.

One thing that is currently a chart magnet that will likely be addressed within this 2-4 week period of time are the gaps created this past Monday on the daily chart. In the DOW that gap is at 19121, in the SPX it is at 2300, and in the NASDAQ it is at 6984. The gaps are not supported with news and that means that technical and chart traders will not be aggressive buyers until those gaps are closed. The timing of the closures is not yet clear, other than to say that no buy signal of any consequence or dependability can occur until those gaps are closed. As such, it can be expected that some time before the next set of important reports that start coming out the beginning of May, those gaps will be closed.

To the upside and on an intraweek basis, the DOW shows minor resistance at 23189 and minor again but likely indicative at 25020. The SPX shows minor resistance at 2637 and again minor but likely indicative at 2711. The NASDAQ shows minor resistance at 7809 and again at 7875, which also carries the tag of likely being indicative.

To the downside and on an intraweek basis, the DOW shows minor support at 21154 and then nothing until 18917. The SPX shows minor support at 2478 and then nothing until 2280. The NASDAQ shows minor support at 7200 and then nothing until 6686.

It needs to be mentioned that the trading will continue to be very volatile and with big trading ranges, which is something a traders psyche normally responds to automatically with some form of extreme fear or gladness. Nonetheless, the computers and algorithms do not respond to emotions and therefore, chart resistance levels will continue to be somewhat dependable and pivotal. As such, I would venture to say that if the DOW breaks below 21154, the SPX below 2478 and the NAZ below 7200, that the next support levels will be targeted. With those "next" support level targeted, if reached, the gaps are likely to be closed. As such, these minor support levels are likely to be dependable pivot points this week and for the next couple of weeks.

On the opposite side of the coin, the same can be said about the upside if the first set of minor resistance levels mentioned above are broken (DOW at 23189, SPX at 2637 and NAZ at 7809), then the next set of resistance levels will be targeted and reached. Nonetheless, in the case of the NASDAQ and SPX, those levels represent the areas that were broken on a weekly closing basis to generate the bear market signal. Given that it seems almost impossible at this time that the bear market signal will be negated, it would suggest that the indexes are not going to be moving substantially higher this week, especially considering that the NAZ got up to 7809 and the 7870 level is where that 20% is located. This does suggest that this coming week will be mostly red, though a rally above last week's highs is likely to be seen, meaning some minimal green above last week's highs could occur.

It is evident that the NASDAQ is the index to watch closely this coming week. It does need to be remembered that the 20% bear market signal is based on the weekly closing chart and since that bear signal was given the previous week, the bulls are going to do everything in their power to negate that signal "this" week. There is some copious (8 previous daily highs or lows) but not strong intraweek resistance between 7946 and 8065. Based on the scenario presently in place, that area on an intraweek basis, has to be considered a brick wall at this time. Whether the bulls can get that high is a big question mark that has no answer at this time. The probabilities do not favor the bulls being able to rally the index up to that level given the overwhelming negative economic scenario that is in place. Nonetheless, if they are successful in doing that, it is highly improbable that area will be broken on an intraweek basis and by Friday, the index should close at or below 7870. That is the "best" case scenario for the bulls.

One other important chart thing to mention is that the monthly closes occur on Tuesday and in this scenario those closes do have quite a bit of importance. In the DOW there is pivotal support at 23327, in the SPX there is pivotal support at 2503 and in the NASDAQ there is short term pivotal support at 7453. The DOW is trading below that level already but the SPX and NAZ closed on Friday above those levels. If on Tuesday, all indexes close below those pivotal supports, the bears will establish one additional and strong chart signal of weakness. If they close above, the bulls will still have a chance of not generating a strong and new sell signal on the monthly chart. Tuesday's close represents an area that is strongly pivotal in favor of the bears and a defensive area for the bulls regarding leaving the door open for a sooner (rather than later) recovery rally.

As far as the beginning of the week, the indexes all closed near the lows of the day on Friday and the first course of business should be to the downside with the NASDAQ targeting the 7200 level of support for a retest, which would suggest that on Monday and probably no later than Tuesday, that level will be tested on an intraweek basis. Probabilities for this week are about even as there is nothing very clear regarding the immediate short-term action.