Bulls Close April with a Bang
Wall Street closed out April with a sharp V?shaped recovery, and action we predicted throughout March, by starting off May with another round of record highs. The Nasdaq and the S&P have scored double-digits gains off their March 30th lows with the current rally being driven by strong earnings.
The Nasdaq tagged a lifetime high of 25,223 while settling at 25,114 (0.9%). Undefined resistance at 25,250 was challenged and held. Rising and new support is at 24,500.
The S&P 500 closed at 7,230 (0.3%) after hitting a late day and all-time high of 7,234. Undefined resistance at 7,250 was challenged and held. Support is at 7,150.
The Dow traded up to 49,988 before ending lower (again on a Friday) at 49,499 (-0.2%). Resistance at 50,000 held. Support is at 48,750.
Earnings and Economic News
Before the open: Berkshire Hathaway (BRK.B), Tyson Foods (TSN)
After the close: Palantir Technologies (PLTR), onsemi (ON), Transocean (RIG),
Economic News
None
Technical Outlook and Market Thoughts
For the week, the Nasdaq rose 1.1% and the S&P 500 and the Russell gained 0.9%. The Dow lagged but was up 0.5%. Year-to-date, the Nasdaq has jumped 8% and the S&P has rose 6%. The Dow is up 3% and the Russell has zoomed 13% this year.
The Russell 2000 traded to a high of 2,815 with key resistance at 2,800 getting cleared and holding. Multiple closes above these levels and the April 21st peak at 2,817 gets a possible FOMO rally up to 2,900-3,000 in focus.
Current support is at 2,725-2,700 with backup help at 2,675. Closes below 2,600 and the 50-day moving average would indicate a near-term top.
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The Nasdaq hit a record peak of 25,223 with our upper and revised and upper Price Target at 24,750-25,250 from April 17th holding be a smidge. We mentioned last week we thought these would hit by summertime, or at some point in 2026, but here we are knock, knock, knocking on heaven’s door. We also said there is stretch up to 25,500-25,750 on closes above 25,250.
Rising support is at 24,500-24,250. Closes back below 24,000 could lead to further weakness down to 23,500-23,000.
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The S&P 500 hit a record high of 7,272 on Friday. We recently predicted closes above 7,150 would be bullish for further gains up to 7,350-7,500 over the next 6-9 months.
Support is at 7,150-7,100. Closes below 7,000 would suggest a near-term peak with retest potential down to 6,800 and the 50-day moving average.
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The Dow held crucial support at 48,750, after getting stretched on Wednesday, and again on Thursday. Closes below 48,000 and the 50-day moving average would be a bearish development and would likely indicate a near-term top.
Key resistance is at 50,000 with Friday’s peak at 49,988. Closes above 50,500 and the February 10th all-time top at 50,512 would suggest strength up to 52,000-53,000.
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The S&P 500 Volatility Index (VIX) tested a weekly peak of 19.43 on Tuesday with lower resistance at 20-22 holding. We have been mentioning closes above 22.50 could lead to strength towards 24-26 and likely confirm near-term market WEAKNESS.
New support is at 16.50-16. Closes below the latter would be BULLISH for the market with weakness in the VIX down to 15-14.50.
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The current rally has been hard for some investors to digest based on ongoing geopolitical uncertainty and lingering energy concerns. That apparent disconnect has left many traders confused and why we always trust the charts.
We have been mentioning the relative strength index (RSI) levels for the major indexes as they have stayed above 70 for the past three weeks in the Nasdaq and the S&P. A reading above this level indicates overbought conditions. However, we have been telling you the market, individual stocks and ETF’s, can stay overbought for weeks and months.
For instance, RSI on the Nasdaq has closed above 72 the past three Fridays and is currently at 72.50. RSI was at 71 for the S&P and 62 for the Dow on Friday. Interestingly, the Dow’s RSI has NOT cleared 70 since last July. As far as the Russell’s RSI, it closed at 67 on Friday after peaking at 73 last month.
The current uptrend channels were stretched midweek but Thursday’s rebound off key support levels keeps them in play as they can be adjusted. However, we want to confirm possible higher highs throughout this week before possibly adjusting them.
We mentioned coming into last week, we wouldn’t be surprised if there is a short-term market top after Apple’s earnings on Thursday, or into the first full week of May. That is this week and the one bearish signal we are watching is the possible shooting star candlestick on the S&P 500 from Friday.
A shooting star is a candlestick, that forms when a stock or index advances significantly, but then closes the session near its open. It is a potential bearish reversal signal for the S&P 500 if the index closes back below 7,150 this week.
For the year, the Track Record is now at 22-4 (85% win rate) for our Velocity Options directional Alerts with FIVE triple-digit winners: IRDM calls 120%; KEY calls 107%; VIAV calls 271% and 319%; and BCRX calls 100%. We almost had our sixth triple-digit winner but CMCSA was stopped out for an 85% win on Friday.
Our covered call Alert (Real Wealth) portfolio stands at 7-0 and our Credit Spread newsletter (Red Zone Trades) is at 10-2 (83%). Overall, the Track Records are at 39-6 (87% win rate).
We could have another round of New Alerts across all newsletters this week so stay locked-and-loaded. Don’t forget to signup for Text Alerts if you haven’t done so already.
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