Nasdaq Clears 20,000

• All of the major indexes broke above key resistance levels on Tuesday following a cease fire deal between Israel and Iran. Oil stabilized, and for now, tension in the Middle East has calmed down.
• Last week’s consolidation period was a healthy sign as golden crosses were in the midst of forming on the Nasdaq and the S&P 500. These bullish patterns continue to play out on both indexes and is confirming the near-term run to higher highs.
• New and shaky support levels that we are now watching: Nasdaq 19,750; S&P 6,050; Russell 2,100; and Dow at 42,750. A drop back below these levels would would indicate a possible false breakout.

The stock market broke above key levels of resistance on Tuesday following last week’s trading range. Wednesday’s continuation to higher highs firmly gets fresh all-time peaks in focus as positive geopolitical developments have lifted sentiment.

The Nasdaq closed at 19,973 (+0.3%) after tagging a high of 20,052. Resistance at 20,000 was topped but held. Support is at 19,750.

The S&P 500 traded up to 6,108 before settling at 6,092 (-0.0%). Key resistance at 6,100 was cleared but held. Support is at 6,050.

The Dow finished at 42,982 (-0.3%) with the low hitting 42,871. Support at 42,750 held. Resistance is at 43,250.

Earnings and Economic News

Before the open: Acuity Brands (AYI), Orion Lighting (OESX), Walgreens Boots Alliance (WBA)

After the close: American Outdoor Brands (AOUT), Concentrix (CNXC), Nike (NKE)

Economic news:

Initial Jobless Claims – 8:30am

GDP – 8:30am

Pending Home Sales – 10:00am

Technical Outlook and Market Thoughts 

All of the major indexes broke above key resistance levels on Tuesday following a cease fire deal between Israel and Iran. Oil stabilized, and for now, tension in the Middle East has calmed down.

Last week’s consolidation period was a healthy sign as golden crosses were in the midst of forming on the Nasdaq and the S&P 500. These bullish patterns continue to play out on both indexes and is confirming the near-term run to higher highs.

The Nasdaq cleared and held 19,750 on Tuesday and an area that now represents near-term support. There is retest potential to 19,250 if 19,750 fails to hold.

Continued closes above 20,100 would indicate a run to 20,250-20,500 with last December’s all-time top at 20,204. This level represents the triple top breakdown from late February.

The S&P 500 surged above 6,050 on Tuesday and is now fresh support over the near-term. There is wiggle room down to 6,000, if breached.

Fresh resistance is at 6,100 followed by 6,150 and the all-time peak at 6,147. Closes above the latter two levels would be bullish for a possible run up to 6,250-6,300.

The Russell 2000 broke above 2,135 on Tuesday and a level that held on Wednesday’s session low. Backup support is at 2,100-2,075 if 2,135 fails to hold.

Resistance is at 2,175. Closes above this level could lead to a quick trip up to 2,200-2,300.

The Dow cleared its June 11th peak at 43,115 with Tuesday’s intraday peak at 43,183. Closes above 43,250 would be bullish for upside towards 43,750-44,000.

A move below fresh support at 42,750 would signal possible weakness down to 42,500-42,250 and the 200-day moving average.

The Volatility Index (VIX) closed below 17.50 for the second-straight session with the 50-day moving average in a sharp downtrend. This level is now key resistance. The index is also in the early stages of forming a death cross and typically indicates lower lows. This is bullish for the market.

New support is at 16.50-16 with yesterday’s low at 16.68.

New and shaky support levels that we are now watching: Nasdaq 19,750; S&P 6,050; Russell 2,100; and Dow at 42,750. A drop back below these levels would would indicate a possible false breakout.