U.S. markets showed strength throughout Thursday’s session while recovering losses over the last couple of sessions to keep fresh resistance and 2019 highs in play.

Better-than-expected economic news helped overall sentiment but the weakness in the Financials remain a slight concern following the Fed news they weren’t going to raise rates this year.

The Nasdaq jumped 1.4% after tapping a fresh 2019 high of 7,850 to extend its winning streak to 5-straight sessions.

The close above the 7,800 level was super bullish with fresh and lower resistance at 7,850-7,900 holding into the closing bell.

The Russell 2000 rallied 1.3% following the first half push to 1,569 and topping Monday’s peak by a third-point. Lower resistance at 1,570-1,585 held with a move above the latter and the 200-day moving average being a bullish signal for higher highs.

The S&P 500 advanced 1.1% following the run to 2,860.

Major resistance at 2,850 was cleared and held with continued closes above this level being a bullish setup for a run towards 2,875-2,900.

The Dow rose 0.8% to regain positive territory for the week after reaching an intraday peak of 26,009.

Lower resistance at 26,000-26,250 held for the 4th time in 5 sessions with continued closes above the latter being a more bullish development.

Technology led sector leaders after zooming 2.5% while Real Estate and Consumer Discretionary added 1.8% and 1.4%, respectively.

Financials were the only sector laggard after giving back 0.3%.

Global Economy – European markets showed overall weakness after the Bank of England held interest rates steady while noting Brexit uncertainties continue to weigh on confidence and short-term economic activity, notably business investment.

Germany’s DAX 30 fell 0.5% and France’s CAC 40 was dipped 0.1%. The Stoxx 600 Europe slipped a fifth-point, or 0.04% and the Belgium20 was off a point, or 0.03%. UK’s FTSE 100 rose 0.9%.

The Bank of England (BOE) held interest rates steady at 0.75%, as widely expected.

Asian markets closed mostly higher with Japan’s Nikkei closed for a holiday.

South Korea’s Kospi and China’s Shanghai rose 0.4%. Australia’s S&P/ASX 200 added 2 points, or 0.3%. Hong Kong’s Hang Seng sank 0.9%.

Australia’s jobless rate fell to a near 8-year low in February as a total 4,600 net new jobs were created with all of the increase led by part-time work.

The participation rate fell to 65.6% from 65.7% with the jobless rate at 4.9% and the lowest since June 2011.

Initial Jobless Claims dropped 9,000 to 221,000, missing forecasts for a print of 225,000. The 4-week moving average edged up to 225,000 from 224,00. Continuing claims fell 27,000 to 1,750,000.

Philadelphia Fed Business Outlook Survey rebounded 17.8 points to 13.7 in March, topping than expectations of 5.5. The employment component slipped to 9.6 from 14.5, with the workweek at 10.6 from 4.7.

New orders improved to 1.9 after dropping to -2.4 previously. Prices paid declined to 19.7 from 21.8, with prices received dipping to 24.7 from 27.7.

The 6-month general business index fell to 21.8 from 31.3.

The future employment gauge edged up to 24.9 from 23.6. New orders fell to 19.8 from 29.4 while prices paid rose to 47.3 from 39.8 and prices received at 32.4 from 29.7.

The 6-month capex component declined to 19.5 from 31.7.

Leading Indicators Index rose 0.2% to 111.5 in February, topping forecasts for a rise of 0.1%, and ties the September print for an all-time high.

Of the 10 components that make up the index, 6 made positive contributions including stock prices (0.22%) and the leading credit index (0.08%), while 2 contributed negatively, including the average workweek (-0.13%) and jobless claims (-0.02%).

ISM new orders and building permits were unchanged.

Quarterly Services Survey showed a 6.3% Q4 year-over-year gain in the aggregate selected services measure.

For the larger components, the finance and insurance component surged 8% year-over-year while the healthcare and social assistance component rose 3.8%.

The components used to calculate GDP boosted Q4 GDP growth revisions to 2.4% from 2.3%, versus the previously reported 2.6% figure, thanks to expected boosts of $3 billion for service consumption and $2 billion for intellectual property.

For previously assumed Q4 component revisions, analysts expect downward bumps of $6 billion for goods consumption, $5 billion for public construction, $3 billion for residential construction, and $2 billion for exports. Analysts expect a $1 billion boost for imports that subtracts from GDP, and a $2 billion hike for factory inventories.

Market Sentiment – The iShares 20+ Year Treasury Bond ETF (TLT) showed strength for the 2nd-straight session after trading to an intraday high of $123.09.

Fresh and lower resistance from early January at $123-$123.50 was cleared but held. Continued closes above the latter would be a bullish setup for a possible run towards $124-$125 with the current 52-week peak at $123.86.

Rising support is at $122.50-$122. A close back below $121.50 would signal a near-term top with risk towards $121-$120.50 and the 50-day moving average.

Market Analysis – The Spider Small-Cap 600 ETF (SLY) snapped a 2-session slide after testing an intraday high of $67.96. Near-term and lower resistance at $68-$68.50 was challenged but held.

A move above the latter would be a bullish development for a possible push towards $69.50-$70 and the 200-day moving average.

Current support is at $67-$66.50 and the 50-day moving average. A close below $66 and the monthly low would be a slightly bearish development.

RSI is back in an uptrend with near-term resistance at 55-60.

Continued closes above the latter would signal additional strength towards 65-70. Support is at 50 with a move back below this level signaling risk towards 45-40.

The Energy Select Sector Spider (XLE) showed strength for the 2nd-straight session after making an intraday push to $67.40.

Prior and lower resistance from early November at $67-$67.50 was cleared and held. Continued closes above the latter would be a slightly bullish development for a possible run towards $68-$68.50 and the 200-day moving average.

Rising support is at $66.50-$66.

A close below $65.50 would signal a near-term top with downside risk towards $64 and the 50-day moving average.

RSI is back in an uptrend after clearing and holding lower mid-February resistance at 65-68. A bullish signal would be on a close above 70 and a level that held last September/ October.

Continued closes above 70 would signal additional momentum towards 75-80 and May 2018 highs. Support is at 60 with risk to 55-50 on a move back below this level.

Position Update

Expect market to cool off next few days and begin assimilating FED data.

I’m going to begin looking at iron condors since flat period is anticipated

Next few days expect a bit more distribution than we’ve seen since volatility is heating up.

I believe stocks will see two sided market action till end of week.

Roger Scott.