Confirmed Technical Breakouts

After 2-years of lackluster trading range conditions key US stock market indexes have broken out of their respective 2-year trading ranges. In fact, key indexes have completed 3 bullish technical basing patterns over the past 2-months. Although there may still be minor corrections these technical breakouts are significant reaffirming the next sustainable rallies for S&P 500 Index, Dow Jones Industrial Average, and NASDAQ Composite Index over the intermediate-term time horizons.

S&P 500 Index (SPX) – (1) triangle breakout above 3,0167 (10/25/19 ) = +202.47 points or 3,219.50 (near-term), (2) uptrend channel breakout above 3,168 (12/12/19) = +239 or 3,407 (medium-term), and (3) 2-year broadening top/bottom and/or head/shoulders bottom breakout above 3,061 (11/1/19) = +594.33-681.40 or 3,655-3,742 (longer-term).

Initial support = 3,058-3,069 (extension of the 2-year breakout and 50-day ma).

Secondary support = 3,009-3,022 (extension of triangle and Sep 2019 high).

Medium-term support = 2,894-2,943 (bottom of triangle, bottom of uptrend channel and 200-day ma)

Dow Jones Industrial Average (INDU) – (1) symmetrical triangle breakout above 27,222 (11/1/19) = +2,627 or 28,734 (top of 2019 uptrend channel – near-term), and above this to 29,849, medium-term, (2) breakout above 28,734 (top of channel) = +2,345 or 31,079 (intermediate-term), and (3) convincing move above 27,563 (11/7/19) confirms 2-year broadening and/or head/shoulders bottom breakout = +5,239-5,625 or 32,802-33,219 (long-term).

Key initial support = 27,583 (extension of 2-year breakout).

Secondary support = 27,160-27,374 (12/31/9 low, 50-day ma, and extension of triangle breakout).

Intermediate-term support = 26,270-26,564 (200-day ma, bottom of 2019 uptrend channel, and bottom of triangle).

NASDAQ Composite Index (COMPQ) – (1) triangle breakout above 8,195 (10/25/19) = +676.74 or 8,872 (near-term), (2) 2019 uptrend channel breakout above 8,590 (11/22/19) = +734 or 9,324 (medium-term), and (3) 2-year broadening pattern and/or head/shoulders bottom breakout above 8,420 (11/1/19) = 1,943-2,149.47 or 10,363-10,569.5 (long-term).

Initial support = 8,600-8,616 (extension of uptrend channel breakout).

Secondary support = 8,435-8,451 (extension of 2-year breakout and 12/3/19 low).

Medium-term support = 8,032-8,070 (extension of triangle breakout and 200-day ma).

Intermediate-term support = 7,734-7,915 (Jun 2019 uptrend and bottom of triangle).

Source: Courtesty of StockCharts.com

Source: Courtesy of StockCharts.com

Source: Courtesy of StockCharts.com