Technical analyst Dave Chojnacki of Street One Financial examines yesterday’s Trump-fueled equities rally and updates the technical levels investors and traders should focus on for the Dow, Nasdaq, and S&P.

Trump Trumps All

Equities opened slightly higher yesterday morning, despite mixed messages on the earnings front. Existing Home Sales, out at 10:00am, were below expectations. The major indices ignored all these reports, as Trump news is moving the markets. The rally lasted through most of the day, when the indices saw a brief pullback in the last hour. The NDX and SPX both made new highs in the session. All three major averages had moderate gains on the day. At the close, the DJIA was up 0.57%, the SPX added 0.66%, and the NDX gained 0.7%. Breadth was decidedly positive, 2.8 to 1, on above average volume.

Breakout To The Upside Coming?

ROC(10)’s advanced in the session, with the SPX and the DJIA moving into positive territory. The NDX remains in positive territory. RSI’s were higher with the NDX at 70.7, beginning to tread into overbought territory. The DJIA and SPX ended near 60.

MACD’s remain below signal for the DJIA and SPX and above signal for the NDX. The ARMS index ended the day at 0.95, nearly neutral. It was the first strong upside move for the DJIA and SPX since early December, showing signs of wanting to break out of the long ‘Bull handle’ pattern.

Since the election rally began, the DJIA continues to be the strongest index, up 8.6%. The NDX is up 6.1%, and the SPX up 6.5% in that same time frame. The NDX continues to be the strongest index near term, setting new highs yesterday of 5101 (closing) and 5108 (intra-day).

The DJIA crossed above its 20D-SMA (19867) yesterday. It remains just below its early January closing high of 19963. The SPX made a new closing high of 2280 and intra-day high of 2284. The SPX put further distance from its 20D-SMA of 2266.

IWM (Russell small-caps) had a strong day up 1.5%. The VIX fell 5.9% to 11.07. Near term support for the NDX is at 5075 and 5050. Near term resistance is at 5125 and 5150. Near term support for the SPX is at 2276 and 2266. Near term resistance is at 2288 and 2300.

Markets Up Early As Earnings Season Flourishes

Europe is significantly higher in morning trading, while U.S. Futures are pointing to a strong open in the premarket. In terms of economic news on tap today, we’ll see the FHFA Housing Index numbers at 9:00am, and Crude Inventories at 10:30am.

Other than those two economic reports, the earnings deluge from major companies continues. Boeing and Novartis were gaining in early trading following their latest reports, while United Technologies was lagging.

The SPDR Dow Jones Industrial Average ETF (NYSE:DIA) rose $0.79 (+0.4%) in premarket trading Wednesday. Year-to-date, DIA has gained 0.67%, versus a 1.82% 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 #6 of 77 ETFs in the Large Cap Value ETFs category.

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.