Technical analyst Dave Chojnacki of Street One Financial wraps up the trading week with a look at the major U.S. averages, which took a breather on Thursday after Wednesday’s big Fed-inspired rally.

A plethora of economic numbers yesterday morning were primarily positive, and equities opened slightly higher. The major indices attempted to follow through on the prior strong session, which was fueled by the Fed’s expected rate hike.

Unfortunately, stocks quickly reversed and moved lower through the morning hours. The PM was spent with equities nearly flat and staying in negative territory. Clearly, there was little interest by traders to continue the prior session’s rally.

By the final bell, the major averages ended the day slightly lower. At the close, the DJIA fell 15.5 points, the SPX inched down 3.8 points, and the NDX slipped 4.1 points. Breadth was positive, 1.3 to 1, on below average volume. ROC(10)’s were mixed, with the DJIA and NDX advancing and the SPX declining. The DJIA and SPX remain in negative territory there.

RSI’s were slightly lower, with the NDX remaining the strongest at 71.5, nudging into overbought territory. All three major averages remain with their MACD below signal. The ARMS index ended the day at 1.33, a slightly bearish level.

It was a bit disconcerting that equities could not follow through on the prior session’s strength. The NDX traded above the prior session’s close (5416) briefly, but could not push through the intraday high of 5426 and ended the day 4 points below the prior session record close. It remains above its 20D-SMA of 5361, and closed just 5 points below its Bollinger Band top of 5419. The DJIA and SPX remain above their 20D SMAs of 20863 and 2370, respectively.

IWM (small-caps) ended higher at 137.91, but remains below its recent closing high of 140.36. GLD (Gold) closed up 0.41% to 116.73. The VIX moved lower to finish at 11.21, off 3.6%. Volatility remains extremely low.

Near term support for the NDX is at 5400 and 5390. Near term resistance is at 5425 and 5450. Near term support for the SPX is at 2375 and 2370. Near term resistance is at 2392 and 2400.

Europe is pointing higher in early trade this morning, while U.S. Futures are moderately higher in the premarket. We’ll see three major economic reports today that could influence the major averages, including Industrial Production & Capacity data at 9:15am, Leading Indicators at 10:00am, and Michigan Consumer Sentiment also at 10:00am.

The SPDR Dow Jones Industrial Average ETF (NYSE:DIA) rose $0.02 (+0.01%) in premarket trading Friday. Year-to-date, DIA has gained 6.04%, versus a 6.69% rise in the benchmark S&P 500 index during the same period.

DIA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #5 of 74 ETFs in the Large Cap Value ETFs category.

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Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, David Chojnacki, does not endorse or recommend any issuer or security mentioned herein.

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