Running Out of Steam

If historical price charts play out, next week should see the beginning of a more protracted loss of upside momentum

By Paul Cherney

Friday, Nov. 2, is the likely calendar date for the last day of the positive bias inside this consolidation to remain in place. If historical price charts play out, the beginning of a more protracted loss of upside momentum should start next week.

History never really repeats itself exactly. Much of the work I do is simply looking for similar technical power resulting in a rollover and a retest of the price range from Sept. 21 (S&P 500). Based on the charts, I had selected a close over S&P 500 1,123 level as my "stop loss" price, the point at which I should stop worrying about a move back below 1,000 for the S&P 500.

A close above 1123 was my "say uncle" price point. I am now lowering that "say uncle" price point to a close above 1110.61, which is the highest print of the recent sideways trading range.

The S&P 500 has an important price support at 1052. A close below this level opens downside risk for a move to the next layer of support is 1022-1000. That is a "close below" 1052.

The S&P 500 finished Thursday's session inside resistance which is 1075-1090. The next layer of resistance is 1101-1111.

The Nasdaq has immediate support at 1719-1683 with a focus 1717-1711. The index closed Thursday's session inside resistance, which is 1722-1754. The next layer of resistance was formed on Oct. 26 and it is 1767-1793.

The Nasdaq has major resistance at 1782-1934. Resistance becomes thicker with prints of 1825-1887.

The DJIA has immediate resistance at 9400-9605.

Cherney is market analyst fro Standard & Poor's

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