By Paul Cherney
The following statistics are based on S&P 500 price data from 1972 through 2003.
The Tuesday after Memorial Day weekend has been higher only 12 out of 32 times, or 37.5% of the time.
There is probably additional upside left for the current move, but not every day is a gainer even in the strongest of trends.
A measurement of the NASDAQ price range of 1865 to 1938, added to the 1938 level equals 2011, this calculation is how some chartists would create an upside target for the NASDAQ if there is going to be a successful run after Tuesday's bullish breakout. The same calculation performed on the S&P 500 would equate to an S&P 500 level of 1136.
Immediate intraday resistance for the NASDAQ is 1989-2009.11.
Immediate support for the NASDAQ is 1975.66-1967.40 which represents a focus of support. There is another layer of support 1971-1957.58. That makes the 1971-1967.40 area thick support. Additional supports under 1957 are 1951-1945, then 1934-1913.73, then 1918.08-1899.85 with a shelf of support 1918-1914.
Immediate intraday resistance for the S&P 500 is 1116-1129.25. The S&P 500's next layer of resistance above 1116-1129.25 is 1135-1149.
Immediate intraday support for the S&P 500 is 1116.71-1109.91 with a focus inside this zone at 1116-1112.71. The index has a small shelf 1109.04-1106.10, then substantial support 1100.72-1090.74.
If there is a retracement into Tuesday's price range, it would be a sign of a strong market if buying support became obvious well above the 50% retracement of the daily range. That would mean prices should preferably attract buyers before prints of (roughly) NASDAQ 1938, S&P 500 1101. So far, there has been no appreciable weakness.
During retracements, truly bullish markets often only approach support zones without printing inside them because buyers are so aggressive that they are satisfied with buying at any price cheaper than the previous print.
Cherney is chief market analyst for Standard & Poor's