Wednesday's Rise a One-Day Wonder
By Paul Cherney
I think Wednesday's price advance was just a "one day wonder." For Thursday, a day of hesitation or lower prices should unfold.
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 has closing support in the 1062-1054 area. Immediate S&P 500 resistance is 1075-1090 then 1101-1111. (Wednesday's intraday high was 1074.79, just shy of the first layer of resistance in the 1075-1090 area.
The Nasdaq has resistance 1683-1695 then 1722-1754. The index has immediate support 1664-1628 with a focus 1657-1641. The Nasdaq has another layer of support 1626-1566 which should act like a floor for prices (if tested).
The S&P 500 looks a little more vulnerable than the Nasdaq's chart. This does not mean a bigger percentage loss for the S&P 500, just that the potential for downside occurring looks more likely in the S&P 500's chart.
Cherney is market analyst for Standard & Poor's