By Paul Cherney
The intermediate term trend (the next couple of weeks) for the Nasdaq and the S&P 500 remains tilted in favor of higher prices. The worst case scenario I see for the Nasdaq would be a retest of the 2523-2482 area of support.
A real test of the resolve of this market (Nasdaq) for the next couple of weeks could be INTC's earnings report (and guidance). If the company gives lower guidance for the future but the equity markets can move higher, then this would be another confirmation that the markets are willing to look over the earnings valley, bolstered by the opinion that the Fed's shift to an ease in monetary policy will keep equity prices from dropping.
This is option expiration week. The Wednesday in the week of option expiration has been traditionally used by option players to close out current month contracts and move forward. Quite often, a flat to lower open (on Wednesday) can see prices reverse and head higher.
The Nasdaq is currently inside the 2588-2645 area of resistance. Immediate resistance is 2676-2726 with a focus of resistance in the 2688-2711 area.
Immediate Nasdaq support (intraday) is 2620-2589 then 2586-2550. The next layer of support is 2523-2482.
The S&P 500 is testing immediate resistance in the 1323-1334 area.
Immediate S&P 500 support is 1312-1287.
Cherney is market analyst for Standard & Poor's