The major indexes responded very bullishly after a closing last week on a negative note. The NASDAQ gained the most, 1.33%, with volume off around 15% from the 50 day average.

One of the more interesting factors at play is the fact that the NASDAQ closed at levels of resistance and it looks as though the trading channel is narrowing.

Here’s a chart:

The NASDAQ's trading channel is slightly different from the other indexes as it has a rising lower bound.

Don’t be surprised to see the markets pull back tomorrow, but we are nearing a point where stocks will have to either push above resistance or fall below support.

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