NextOptions.com Market Outlook for 3/2/2026

Small-Caps Hold 50-Day MA

The stock market was lower for the week as the market survived another bear strike on Friday with key support levels holding. The Dow and the S&P 500, however, fall back below their 50-day moving averages with the Russell 2000 holding this level into the weekend. 

The Nasdaq fell to a low of 22,538 while settling at 22,668 (-0.9%). Key support at 22,500 held. Resistance is at 23,000.

The S&P 500 closed at 6,878 (-0.4%) after tagging a low of 6,831. Support at 6,850 was tripped but held. Resistance is at 6,900.

The Dow bottomed out at 48,678 before finishing at 48,977 (-1.1%). Key support at 49,000 failed to hold. Resistance is at 49,250.

Earnings and Economic News 

Before the open: Berkshire Hathaway (BRK.B), ADT (ADT), Sealed Air (SEE)

After the close: Riot Platforms (RIOT), Quantum Computing (QUBT) 

Economic News

PMI Manufacturing Index – 9:45am 

ISM Manufacturing Index – 10:00am

Technical Outlook and Market Thoughts 

For the week, the Nasdaq was down 1% and the Russell sank 1.4%. The S&P 500 gave back 0.4% and Dow dropped 1.3%. Year-to-date, the Nasdaq is lower by 2.5% and the S&P is higher by 0.5%. The Dow has added 1.9% and the Russell is still up 6% for 2026.

The Dow struggled clearing 49,600 throughout February (and January) as this level has basically been holding in 8 of the past 10 sessions. Closes back above 49,600 keeps the next waves of resistance at 50,000-50,500 in focus with the February 10th all-time top at 50,512.

The close below 49,000 and the 50-day moving average was slightly bearish. Backup support is at 48,500 and has been holding since the January 5th breakout above this level. The 48,000 level has been solid since mid-December.

The Russell 2000 came within a half-point of tripping its 50-day moving average after kissing a low of 2,616 on Friday. Key support remains at 2,600 following the close above this level on January 8th. The small-caps have remained in a 100-point range since then, or 33 sessions. Backup help is at 2,575 with the February 5th stretch and low at 2,569.

Key resistance remains at 2,675 and the top of the downtrend channel with the January 22nd record peak at 2,735.

The S&P 500 has now extended its 200-point range to 47-straight sessions. Key support remains at 6,800 with the yearly and February 17th low at 6,775. The December 17th intraday low and close were at 6,720 and 6,721, respectively. If all the aforementioned levels fail to hold, there is further risk to 6,600-6,550 and the 200-day moving average.

Multiple closes above resistance at 6,925-6,950 would void the current setup and get all-time highs back in focus.

The Nasdaq held crucial support at 22,500 eight times in February with the monthly and 2026 low at 22,256. Closes below 22,500-22,250 would suggest a near-term top with weakness to 22,000-21,500. The latter levels represent 8% and 10% declines from the all-time high from October 29th at 24,019.

Resistance remains at 23,000-23,250. Last Wednesday’s false breakout split the difference with the peak at 23,169. Closes above the latter and exactly where the 50-day moving average is at, would be a slightly renewed bullish signal.

The S&P 500 Volatility Index (VIX) continues to dance inside an adjusting symmetrical triangle after closing just below key resistance at 20 on Friday. We have been warning closes above 22.50-24 would be a bearish development for the market. The February high tagged 23.10 and there have been zero closes above 22.50 this year. A golden cross is now in focus and has been forming since mid-February.

The last close below 17.50 occurred on February 9th and a level that remains key support. The first order of business for the bulls will be to get the VIX back below 18.50.

The downtrend channels off the late January and mid-February highs were stretched for the Nasdaq and the Dow on Wednesday’s false breakout. We often call this action “stretch” and we always say to wait for multiple closes above (or below) a target for confirmation. 

After adjustments, both charts for Tech and the blue-chips show descending triangles in play and this includes the Russell and the S&P, as well. These setups typically lead to lower lows but can be reversed if key resistance levels are recovered. They are at Nasdaq 23,000; S&P 6,950; Dow 49,600; and Russell 2,675.

We have been talking about key support levels for over a month at: S&P 6,800; Dow 48,500; and Russell 2,600. The Nasdaq’s was adjusted from 23,000 to 22,500. If all of these levels fail to hold this month, watch for intense selling pressure.

The March monthly options have 18 days before expiration on Monday’s open. We like to give directional option alerts 4-7 weeks to play out so we have been targeting April calls and puts (48 days) and possibly May options (74 days).

Futures are red ahead of Monday’s opening bell. Dow futures are dropping 360 points; Nasdaq futures are tanking 171 points; S&P futures are sinking 46 points; and Russell futures are in the red by 29 points.

The U.S./ Israel strikes on Iran are the obvious culprit but futures are only down less than 1%. With everybody leaning on the same side of the boat and expecting a massive selloff in the market, we wouldn’t be surprised to see the bulls hold key support levels after some possible stretch. In any event, we are well positioned to play the next major trend and will be watching the action carefully throughout Monday’s session.