GOOGL, MSFT Challenge Recent S&P Rally

Also, the dollar is trading into potential support.

Technical Edge: S&P, GOOGL, MSFT, US Dollar 

• NYSE Breadth: 85% Upside Volume

• Advance/Decline: 84% Advance 

• VIX: ~$28.50

Yesterday we had a better-breadth rally, as bonds ripped and the dollar faded. Today’s early lean is for a continuation in those trades, as bonds are up and the dollar is down. 

But because of weakness in tech, the recent stock gains are being challenged on Wednesday morning. 

Remember, GOOGL and MSFT were two of the long-term setups I was keeping an eye on. I still like them in similar areas. 

S&P 500 — ES 

Traded right into the 50-day and now struggling a bit. If the ES loses 3800, it puts 3750 to 3760 in play (the 10-day ema). 

If it can hold prior resistance near 3820 as support, that’s very constructive for the bulls — especially in light of GOOGL and MSFT earnings — and keeps 3875 to 3900 in play. 

If we zoom in a bit to the H4 chart, keep an eye on the Globex low near 3824 and the 10-ema. A test of this area — like an undercut and reclaim — could give us a long to work with early in the session. 

Otherwise, a break of this area could put 3790 to 3800 in play. 

S&P 500 — SPY