Tomorrow will likely be an interesting day. Third-quarter GDP is expected to clock in at an extremely strong 6%. The reaction to that could be bullish, but the report could also put pressure on the Fed to change its accommodative stance. With the market back near overbought levels and sentiment getting a little giddy again (see the put-call ratio and the VIX, first chart below), anything is possible tomorrow. We lean toward a rally tomorrow, but we wouldn’t be surprised if the report raises inflation fears, assuming the report meets expectations. Internals were very strong for a modest up day, which is bullish, but once again, upside volume was lacking, perhaps due to the wildly varying responses to earnings reports so far. A lot of name stocks are getting hit on earnings. The Nasdaq (first chart below) has support at 1920, and resistance at 1940, 1950, 1967-1970 and 2000. Today was the first day in 7 trading days that the Nasdaq didn’t form a gap. What a volatile period. The S&P (second chart) has support at 1035-1040, and resistance is 1054 and 1070. The Dow (third chart) has support at 9700, and resistance at 9850-9900.
