The bulls bounced back on Wednesday to get their first win of the week as the market ended higher for the session. There was a late-day pullback that ate away at the gains but overall the bears were quiet. They still have the weekly lead but the bulls are closing in.
The Dow gained 62 points, or 0.5%, to finish at 13,390. The blue-chips traded to a high of 13,416 and held green all session long. The close back above 13,350 keeps 13,600 in play.
The S&P added 4 points, or 0.3%, to settle at 1,461. The index reached a peak of 1,464.73 but, more importantly, the 1,450 level held once again and is serving as strong support. Resistance is up ahead at 1,475.
The Nasdaq advanced 14 points, or 0.45%, to end at 3,105. Tech kissed a high of 3,111 and we mentioned a close back above 3,100 would be bullish. The bears will try to attack 3,075 again while the bulls push for a finish above 3,125 this week.
Apple (AAPL, $517.10, down $8.21) looked lost again yesterday and continues to bleed back towards the $500 level. The mid-December low was $501.23 and a close below this level will spark panic or another buying opportunity. The “double-bottom” break below support would be a good clue to use put options for a possible drop to $475. Shares could see a “triple-bottom” reversal if $500 is tested and holds and call options could be used in a move back above $510 to play a run to $540-$550.
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