Some major news is headed the market’s way in the next two days. Will it be enough to break the market out of its narrowest trading range in at least five years (according to Bollinger Band width, that is)? With second-quarter GDP tomorrow morning, and July unemployment, Michigan sentiment and ISM manufacturing on Friday, the market will have plenty of chances to bust out of the two-month trading range (traders could try to get a jump on Friday’s ISM number when the Chicago PMI report is released at 10 a.m. tomorrow). The Dow and S&P (first two charts below) probably reflect the ambivalence as well as anything. After completing bearish “evening star” patterns yesterday, the indexes could be set up for a bullish “rising three methods” pattern if tomorrow is a big up day, because the decline of the last three days has stayed within the body of that first big up day. As usual, the Dow will likely give the first hint that the trading range is coming to an end, with major resistance at 9352, and major support at 9140-9150. On the S&P, 983 and 962 are support, and 995, 1000, 1010 and 1015 are resistance. The Nasdaq (third chart) has support at 1710 and 1685, and resistance at 1740-1747.
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