NextOptions.com Market Outlook for 4/6/2026

Market Rebounds Off Fresh 2026 Lows

The stock market rebounded off fresh 2026 lows to start last week with Monday’s action briefly pushing the S&P 500 into correction territory (down -10%). All of the major indexes held key support levels before Tuesday’s massive end of month and quarter rally that produced gains of 3%-4%.

Thursday’s action was looking dire and threatened to ruin the weekly gains before the market rebounded and ripped higher following positive developments concerning the Strait of Hormuz. Volatility remains elevated but also closed below key support to give the bulls and the market some ongoing hope entering this week.

The Nasdaq closed at 21,879 (0.2%) with the high reaching 21,906. Key resistance at 22,000 held. Support is at 21,500.

The S&P 500 traded up to 6,601 while settling at 6,582 (0.1%). Resistance at 6,600 was topped but held. Shaky support is at 6,500.

The Dow finished at 46,504 (-0.1%) with the low at 45,897. Support at 46,000 was breached but held. Resistance is at 46,750.

Earnings and Economic News 

Before the open: None

After the close: None

Note: The first-quarter earnings season officially starts next Tuesday, April 14th.

Economic News

None

Technical Outlook and Market Thoughts 

For the week, the Nasdaq surged 4.4% and the S&P 500 rallied 3.4%. The Dow jumped 2.9% while the Russell 2000 soared 3%. Year-to-date, the Nasdaq has fallen -5.5% and the S&P is down 3.7%. The Dow has dropped -3.1% while the Russell is back in positive territory by 2%.

The Russell 2000 traded up to 2,535 on Thursday and remains remains in a 20-session range between 2,425-2,550. Closes above key resistance at the latter and the top of the trading range would be bullish for strength up to 2,575-2,600 and the 50-day moving average.

If 2,425 fails again this week, along with the 200-day moving average, it would reopen risk down to 2,375. Monday’s low at 2,404 represented a 12% selloff from the all-time high at 2,735 on January 22nd.

The Nasdaq tapped a low of 20,690 on Monday which represented a 14% shellacking from the October 29th record peak at 24,019. We talked about 500-point drops coming into play in mid-March and we got THREE of them in less than two weeks. Current support is at 21,500 and a level that needs to hold thru the first half of the upcoming week.
 

Key resistance is at 22,000 followed by 22,500 and the 200-day and 50-day moving averages. The death-cross we have been highlighting since mid-February is still getting closer to becoming official but is trying to level out. Closes above both of these levels and 23,000 would suggest a near-term bottom.

The S&P 500 tagged a low of 6,316 last Monday to officially kiss a -10% correction from the all-time peak at 7,002 on January 28th. Closes below 6,350 would reopen downside trouble to 6,200.

Key resistance is at 6,600. Closes above 6,675-6,700 and 200-day moving average would be slightly bullish as the current downtrend channel would be cared.

The Dow’s low at 45,057 last Monday held the prior Friday’s low at 45,063. Both represented a -11% correction from the February 10th record top at 50,512 and possibly formed a near-term double bottom. Our downside target from mid-March at 45,000 held. There is risk to 43,250-42,000 for selloffs of -14% and -17%, respectively, if 45,000 fails to hold this week.

Resistance is at 46,750-47,000 and the 200-day moving average. Closes above the latter and out of the downtrend channel would be sneaky bullish with the 50-day moving average just above 48,000 also flattening out.

The S&P 500 Volatility Index (VIX) closed below 24. A mini symmetrical triangle is forming. Closes above key resistance at 30 will be bearish for the market. Closes below 22-20 would be bullish for the market.