I don't think that the headlines we have seen so far are enough to propel the indexes past the resistance levels mentioned below, but if prices do exceed these levels, that will convert resistance to immediate support. These resistance levels are considerable, they were established at two different times, the end of January and then the middle of February (which acted as a confirmation of the strength of these levels of resistance) Those resistance levels are 835-853 for the S&P 500 and 1331-1363 for the Nasdaq.
Friday should have a positive bias and prices should move a little higher into the resistance levels mentioned above, but the intraday activity probably will not be a straight line.
One of the potential problems for Friday is that some of the buying on Thursday was short-term momentum players jumping on the backs of their bearish brethren as they bought to cover outstanding shorts. The potential for short-term profit-taking by the momentum players is high, especially ahead of a weekend when we really do not have an absolute resolution to the Iraq situation. This should limit the upside.
If the markets continue higher at the open on Friday, but there is not another headline boosting morale, then there should be some short-term long-side profit-taking which will cause an intraday retracement. I think that retracement will find buying interest and prices should be able to lift after that. It is actually better for the market to see a little profit-taking at the open than to just keep steamrolling higher (unless there is a positive headline). Cherney is chief market analyst for Standard & Poor's