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Market Comments for April 6, 2015

 

On Thursday the market gapped up a small amount and after testing the gap fill it quickly ran higher to trade above the prior day’s afternoon consolidation. This set the high for the day right at the 10.00 reversal time at “1”. The market then pulled back to set the low the day going into lunch, and simply consolidated for the rest of the day sideways in a very narrow range. The SPY was identical.

While it was a very narrow day, likely due to the last day before a three day weekend, the market has set up a new consolidation that will be the focus for today. On one hand prices are sitting on the minor support from the prior day’s consolidation at “2”. On the other hand the bigger picture could be viewed as an hourly sell setup and consolidation into the declining 20 period which means that today is the correct focal day for this pattern and the support and resistance areas at “2” and “1” will be key. The path of least resistance is to trade above “1” to confirm the daily support at “4” (also shown on the hourly chart at “3”). So a break below “2” may simply have a target of “3”.