I would have kept it simple today, as everything continued to be balanced yesterday and overnight. Responsive trade from the overnight highs and lows (and going with a breakout in either direction supported by the internals) would have been the best advice. That advice still holds for the S&P 500, though a sudden surge in the NASDAQ 100 at this writing may tilt the S&P 500 bias in favor of a break out to the upside (see below). I am now looking for sideways to higher in the S&P 500 today.

As I was writing, the NASDAQ 100 pushed above its balance/consolidation range and looked to be where the action is. It is now slated to gap open with a true gap, and gap rules will apply. This gap puts the NASDAQ 100 into the new, all-time high territory. Perhaps the S&P 500 index will follow suit – but so far looks to be significantly underperforming the NASDAQ 100. I will be trading the NASDAQ 100 today as a result.

The NASDAQ 100 breaking to all-time highs adds some excitement to this final leg before the nominal 18-month top sets between now and mid-May. We typically get a dip into mid-month (the next payroll contributions) here, and the 40-day cycle dip is due any time, so continue to keep that on your radar screens. I am still finding lots of good stock swing trades – so it is hard to reconcile the good setups I keep finding with anything other than a minor dip this week.

Yesterday’s action continued to bolster our bullish narrative – so best wishes for a good trading day.

A.F. Thornton