By Lawrence G. McMillan, MarketWatch
The stock market suffered some damage through the week ending Jan. 29, but it has rebounded strongly this week. Part of that rebound is due to a seasonally bullish trend near the end of January, where institutional money managers put cash to work. But that seasonally bullish period ended with the close of trading Wednesday, so the market does not have that wind at its back any longer.
The S&P 500 index /zigman2/quotes/210599714/realtime SPX +0.17% bottomed out right at the 3700 level on Jan. 29, so that is support. We continue to view the 3630 level as more important support, however. If the 3630 level were broken on a closing basis, that would turn the S&P chart negative. SPX has rallied enough to close the small gap on its chart left from the Jan. 27 breakdown. So the next resistance area is the all-time highs at 3870 or so.