S&P 500
The S&P 500 rallied during the day on Friday, showing strength at the end of the session, meaning that larger institutional buyers are probably stepping into the market yet again. It looks as if the 2550 level is going to offer support, but quite frankly I think we are getting a bit overextended. Pullbacks should be buying opportunities, even though it could be rather choppy. I think that the 2500 level underneath there is also supportive. I look at buying this market on pullbacks is the only way to deal with it, because buying up at these high levels would be chasing the trade. Expect trouble at the 2600 level, which should be psychologically resistant, but I think given enough time we will probably go beyond there as well.
Nasdaq 100
The Nasdaq 100 broke out to the upside during the day, clearing the 6200 level which has been my target for several weeks. After we broke out of the ascending triangle the 6200 level was important, and the target, but I think that we will eventually go much higher. Based upon the candle that we formed for the Friday session, it’s obviously that the buyers are still very much into the market, and I think now that the 6000 level is the floor. Longer-term, I think we go to the 6500 level, but we are getting a bit stretched in most equities around the world, and especially in the United States. Because of this, I need to see pullbacks instead of buying at the highs, because quite frankly, the higher we go with this point, the more likely the pullback is going to be brutal. Wait for value, it will present itself on those pullbacks.
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