DOW Friday closing price - 17602

The DOW continued its torrid pace to the upside, having generated the 5th green weekly close in a row and extending the rally to 2117 points (13.1%) since the early February low at 15503 was reached. The index closed on the highs of the week and further upside above last week's high at 17620 is expected to be seen this week.

In addition, the DOW bulls were able to produce another small but possibly indicative buy signal, having closed above the previous high weekly close seen in December at 17552 that not only means that all of the weakness seen this year (2016) has been erased but that the high for the last quarter of 2015 at 17977 is likely to be tested this week. A break above that level would set up a retest of the all-time high at 18351.

On the other side of the coin and purely on a technical chart basis, the DOW is facing a strong negative event in the form of crossover of the 50-week MA, currently at 17289, under the 100-week MA, currently at 17268, which has only happened twice in the past 20 years and both times it occurred (December 2000 and July 2008) the index got into a prolonged downtrend that lasted 18 months and 2812 points and 8 months and 4700 points respectively. The crossover is due to occur the following week and only a major rally above 17977 over the next couple of weeks would likely offset the negatives of the cross.

It is important to note that in the cross in the year 2000 the DOW got above the 50-week MA line twice, with the first time being about 350 points and the second time by about 630 points but in neither occasion did the index get above a previous high of such consequence as the 17977 is at this time, meaning that the key and pivotal issue about the cross right now is whether the bulls can take the index above that resistance level or not.

To the upside and on an intra-week basis, the DOW will show minor resistance at 17750 and then decent as well as pivotal resistance between 17901 and 17977. On a weekly closing basis, they pivotal resistance is at 17910.

To the downside and on an intra-week basis, the DOW shows minor support at 17116 and decent as well as pivotal support at 17034. Below the 17000 demilitarized zone, there is mostly open air until minor intra-week support is found at 16333.

The bulls in the DOW are not likely to encounter any fundamental obstacles this coming week as the economic report schedule is bereft of catalytic reports. As such, the traders will likely key on the few chart obstacles that are found, such as the resistance likely to be found around the 17700 level, which is 300 points below the major 18000 level and that does show some minor previous resistance at 17750. As such, the possibilities of the index getting up to the 17700-17730 level this week is high but the probabilities of selling interest coming in at that price are high as well.

Nonetheless, the bulls have accomplished much in the past few weeks and what resistance is left (other than the 17910-17977) is minor in nature and as such not expected to offer much of a challenge for the bulls.

Probabilities favor the bulls this week.

NASDAQ Friday closing price - 4795

The NASDAQ continued to underperform the other indexes, having rallied only 1% compared to 1.4% in the SPX and 2.3% in the DOW. The lack of leadership of the index has to be considered a recurring negative this year as the NASDAQ was the leader the previous 8 years.

The NASDAQ bulls were not even able to get above the December 2014 intra-week high at 4814 or even get up intra-week to the weekly closing high seen then at 4806 (high last week was 4804) in spite of the strenght seen in the other indexes, meaning that the buying interest in the index/tech stocks has been seen mostly on a straggling basis.

By the same token, the NASDAQ closed on the highs of the week and it is expected that further upside above last week's high at 4806 will be seen and if the bulls can get above the intra-week resistance at 4814 they will find only minor resistance above until the gap area between 4929 and 4999 is reached. As such, the NASDAQ could be the key index to watch this coming week.

To the upside and on an intra-week basis, the NASDAQ shows minor to decent resistance at 4814, and very minor at 4836 and 4862. On a daily closing basis and using the chart for the last 52 weeks, minor to decent resistance is found at 4828 and decent at 4893, which is strengthened by the fact the 200-day MA is currently at 4872.

To the downside and on an intra-week basis, the NASDAQ shows minor support at 4712 and then nothing until minor to decent but also short-term pivotal support between 4614 and 4607. Below that level, there is very minor support at 4557 and then minor to decent at 4487. It does need to be mentioned that 4712 was last week's low and any break of that level this coming week would suggest the recent uptrend may have found a snag.

The NASDAQ is likely to be the key index this week, given that the 4814 level that seems to be short-term pivotal resistance is only 19 points above Friday's close. As such, the index is likely to be the first to give indications as to what the traders are looking to accomplish this week. If the 4814 level of resistance is broken, it would strongly suggest that the 200-day MA, currently at 4872, and the 50-week MA, currently at 4896, would become the week's targets. As far as the downside is concerned, the bears would need to generate a break below the 4700/4712 level to generate any new sellin interest and it doesn't like like getting down to that level this week is much of a possibility.

Probabilities favor the bulls.

SPX Friday closing price - 2049

The SPX bulls accomplished much this past week, having confirmed the break of the important 100-week MA, currently at 2016, breaking above the 50-week MA, currently at 2032, and closing the January gap at 2043. The index closed on the highs of the week and further upside above last week's high at 2052 is expected to be seen this week.

Nonetheless, the SPX is now reaching an area of daily close resistance that starts around the 2046 level and increases in importance between 2072-2081 that is going to give the traders a clear idea of just how much more the bulls can accomplish over the next few weeks.

During the past 52 weeks, the SPX generated a total of 3 low daily closes between 2046 and 2056 and a total of 4 low daily closes and 2 high daily closes between 2073 and 2081 that gives the area a lot of chart meaning, especially considering that the last intra-week high of 2015 was at 2081. It also suggests that now the bulls will be facing levels that if broken would be long-term indicative as a break above 2081 would suggest the all-time intra-week high at 2134 would be tested.

To the upside and on an intra-week basis, the SPX shows minor to decent resistance between 2076 and 2081. Above that level, there is minor to decent resistance at 2093 and decent at 2104.

To the downside and on an intra-week basis, the SPX shows minor support at 2019, minor to decent at 1993 and decent as well as pivotal at 1969.

The SPX has now rallied 242 points (11.8%) over the past 6 weeks but has done it straight up without any kind of retesting of the lows or building of support, meaning that the bulls will likely need additional positive fundamental news to keep the buying interest strong. With no scheduled economic reports of consequence due out this coming week, the chart running into levels of resistance that have proven difficult for a whole year, and with economic picture still showing the economy "barely" moving forward, it does suggest that some selling interest of consequence will be found this coming week.

The chart of the SPX suggests the index is likely to get into a short-term sideway trading range between 1995 and 2075 that is likely to be in effect until new economic information of consequence comes out. Further upside above last week's high is likely to be seen this week but the torrid upside pace seen recently is probably going to start to falter this coming week.

Nonetheless, probabilities sill favor the bulls this week, as least as far as some early week strength.

The indexes remain in a torrid rally mode but the levels being reached are of long-term significance, suggesting that the bulls need to have more than momentum to break them. With no possibly catalytic economic reports due out this week, it does suggest that the trading will be more 2-way than what has been seen of late.

Oil, which has been a catalyst to the indexes of late, has also now rallied 36% from its lows and has reached a psychological and chart area of resistance at $40 that likely will require positive fundamental changes to get above and those changes are not likely to happen this week, if they happen at all at the April meeting of OPEC.

What this all suggests is that this week the interest in selling the market is likely to rise, especially if the indexes rally further and get up close to the next areas of resistance (mentioned above).