Support and Resistance Levels – 1,454 and 1,462
The Emini closed down 1.25 points at 1,459.25 on Thursday. Continued strength in the Emini with large volume buying coming in around 1,454 today.
The chart above shows how important this level has been over the last 3 weeks. At the beginning of February 1,454 was resistance that was briefly punctured twice before a retreat to 1,435. When 1,454 was broken on high volume on February 14, the next resistance level became 1,462.
We have been bouncing between these two support (1,454) and resistance (1,462) levels for the last 6 days. 1,454 held again today with large volume buying early on and a low volume test of that level later in the day. So it looks like we’re on our way up to test 1,462 again.
Although my trend oscillators have peaked and started to turn down I am troubled by other signs of strength in the Emini:
- Trading Index (TRIN) divergence with the market down but the TRIN showing buying
- NASDAQ up while the Dow is down
- Long legged doji pattern on the NASDAQ showing buying coming in
- Very strong move by the Semiconductor Index (SOX) which usually leads the broader market
- It has now been almost 20 days since the bond market turned up (I have observed a 20 day delay between the bond and equity markets)
Watch 1,462 closely tomorrow.