Equity indexes face headwinds but have support

Good day! This past week was a rather unproductive one for the markets. My advice last Sunday evening was as follows: "The trend action in all of the strongly-moving commodities from last week can expect to slow in the week ahead with greater chop once again from day to day. The added volatility in this market will keep it active, but the best time frames for trading it at present will be intraday using five to 15-minute time frames for pattern development." Indeed, the range last week was decent, with some strong moves on shorter, intraday trends as the indexes chopped along the 20-day simple moving averages. The result by week's end, however, left investors without much satisfaction.

Dow Jones Industrial Average


Friday's session swung the markets back from the upper end of the 60-minute trading channel back to its lows, thus wiping out the gain made in the previous session and taking the market back to the level that it closed at just a week earlier. The Dow Jones Industrial Average ($DJI) ended the week down 0.3%, while the S&P 500 ($SPX) was lower by 0.2%, and the Nasdaq finished the week unchanged.

The indices had paused after Thursday's sharp ascent and fallen into a period of congestion in the afternoon, but they found support around midnight on Thursday evening and attempted another push higher. That continuation, however, struggled at the upper channel of the 60-minute range and the momentum shifted into the early morning hours. There wasn't an immediate reaction to Friday's morning data, but it did mark the turning point in the indices and within 10 minutes of the 8:30 a.m. ET release of April's Consumer Price Index the index futures were heading sharply lower.

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