Yesterday, the S&Ps gapped open nicely and held gains above the 1287 level. I pointed out on Sunday night that should the market trade above and hold the February 24 low (1287), that it had good odds of trading higher. It rallied to 1296.25.
Trading yesterday occured mostly in the overnight session. Most of the day was spent in consolidation. Because of the consolidating action, we come into today with a narrow range day. So today, we want to watch for volatility expansion. We often (not always) get trending conditions after narrow range days.
Levels to watch today are the 1287-85 level for a test of the February 24 low and,Key Reference Levels
should the market break below that and begin trending down, the 1274-70 level. Should the market break above yesterday’s high, the higher key reference level is 1303-06, which would fill an outstanding gap.
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