Near-Term Resistance Levels Continue to Give the Bulls a Headache

U.S. markets rebounded on Thursday following another round of mostly positive 3Q earnings and upbeat comments on the China trade deal. Larry Kudlow, Director of the National Economic Council, said US Trade Representative Robert Lighthizer has been speaking to high-level Democrats about a trade deal with China.

Kudlow also added although there are skeptics, there is a lot of momentum on both sides toward finalizing a trade deal with China. The major indexes once again pushed near-term resistance levels with Tech and the small-caps tapping higher highs for the week.

The Russell 2000 showed the most strength after jumping 1.1% and tapping an intraday high of 1,542. Upper resistance at 1,530-1,345 was challenged but held with the close back above the 200-day moving average being a bullish signal.

The Nasdaq rose 0.4% following the 2nd-half push to 8,183. Prior and lower resistance from mid-September at 8,150-8,200 was cleared and held with a move above the latter keeping mid-July barriers at 8,250-8,300 in play.

The S&P 500 added 0.3% after trading to a morning high of 3,008. Major and lower resistance at 3,000 was cleared but held with a close above 3,025 and the record peak at 3,027 being an ongoing bullish development with blue-sky territory towards 3,050-3,075.

The Dow nudged up 0.1% with the opening high reaching 27,112. Fresh and lower resistance at 27,200-27,400 easily held with a close above the latter and the all-time high 27,398 getting 27,600-27,800 in focus.

Healthcare and Real Estate were the strongest sectors after rising 0.7% while Communication Services gained 0.6%. Technology was the only sector laggard, despite the higher Nasdaq close, after giving back 0.2%.