WALL STREET >>> DJIA Recaptures 12K

NASDAQ Powers Back Into the Black for the Year

Stocks shot higher at the open this morning, after Dow component AT&T announced plans to acquire rival T-Mobile USA for $39 billion, making it America's largest wireless carrier. In similar fashion, Charles Schwab said it's buying OptionsXpress Holdings in a $1-billion stock-swap deal, amplifying optimism about the collective corporate pocketbook. Elsewhere, the Street cheered encouraging comments from the Nuclear Regulatory Commission, which said the crisis at Japan's Fukushima Daiichi nuclear plant appeared to be stabilizing. As the bullish stars aligned, investors essentially shrugged off a 10% drop in existing-home sales last month, as well as embattled Libyan leader Muammar Gaddafi's vow to wage a "long war" against his opponents.

Against this backdrop, the CBOE Market Volatility Index (VIX) – often dubbed the Street's "fear barometer" – pulled back from multi-month highs, while the Dow Jones Industrial Average (DJIA) extended its run higher to reclaim psychologically critical round-number support.

The Dow Jones Industrial Average (DJIA – 12,036.53) ended the session with a robust gain of 178 points, or 1.5%, reclaiming the 12,000 level for the first time in more than a week. However, the blue chip barometer ran into a wall in the form of its 20-day moving average, which hasn't been surmounted on a daily closing basis since March 9. Taking a look at the index's components, Boeing (BA) paced the 27 advancers with a 3% gain, after the firm's newest 747 passenger jet took flight for the first time on Sunday. Meanwhile, Pfizer (PFE) led the three black sheep lower, surrendering 1% amid litigation concerns.

The S&P 500 Index (SPX – 1,298.38) finished with a similar gain of 19.2 points, or 1.5%, but ran into a speed bump in the round-number 1,300 level, which also houses the broad-market barometer's 20-day trendline. Meanwhile, the Nasdaq Composite (COMP – 2,692.09) fared the best of the three, rallying 48.4 points, or 1.8%, to power back into the black for the year. What's more, the tech-rich COMP reclaimed its 10-day moving average for the first time since March 8, but was stopped short of the 2,700 level.

TECHNICAL ANALYSIS
Dow Jones Industrial Average
The Dow closed sharply higher on Monday as it consolidated some of the decline off February's high. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at 12,048 are needed to confirm that a short-term low has been posted. If the Dow renews the decline off February's high, the 38% retracement level of the June-February rally crossing at 11,339 is the next downside target.

First resistance is the 20-day moving average crossing at 12,048.

Second resistance is this month's high crossing at 12,283.

First support is last Wednesday's low crossing at 11,555.

Second support is 38% retracement level of the June-February rally crossing at 11,339.

HAPPY TRADING