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Markets & Finance

Uncertainty Reigns


By Paul Cherney A close which exceeds 2233.66 on the Nasdaq is still the odds on favorite for another one to three trade days but usually, a day like Tuesday is followed immediately by another day of gains so this chart pattern and these technical conditions may simply be wrong.

Downside appears limited, but so does the upside ahead of the uncertainties of earnings warning season.

Wednesday's action in the Nasdaq has established a band of immediate (intraday) reisstance in the 2230-2250 area. The end of day charts peg resistance in the 2247-2282 area. Volume was not really supportive of a move higher in Wednesday's session as the total trading volume for the day was less than Tuesday's 1.8 billion.

The Nasdaq has a small layer of support 2197-2194 which should produce some sort of a rebound the first time it is tested. However, once the bounce runs out of momentum (if there is a bounce) then the 2194 becomes critical intraday support and the next time prices move below 2194, downside risk opens for prints 2167.24-2150. (Any print below 2194 opens downside risk for prints in the 2167-2150 area, but with this particular chart pattern the first move to the 2197-2194 level should produce a bounce.)

The S&P 500 is testing immediate resistance in the 1253-1295 area. Tuesday's intraday price action has established a small but importaant shelf of resistance (intraday) in the 1284-1286.62. Immediate support is 1283-1270. Then 1265-1254. Cherney is Market Analyst for Standard & Poor's


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