More Losses Likely

The odds are roughly eight in 10 that the Nasdaq will print in the 1745-1705 area

By Paul Cherney

The Nasdaq closed Monday's session below its 20-day exponential moving average of the close and odds are roughly eight in 10 that the index will print in the 1745-1705 area. (There is no specific time target; if the eight in 10 odds are going to come in, it should happen within as few as five trade days but maybe as many as 10 trade days unless some other technical condition emerges.)

The Nasdaq index has a layer of immediate support at 1803-1773 with a focus at 1803-1793 which will probably be used by short-term bearish traders as an opportunity to book short-side side profits, which would mean that it is a likely spot for a bounce to occur intraday.

The end of the quarter and quarterly management fees are based on the value of assets under management, marked to the market as of the close of trading on Thursday, Mar. 28 (the last trading day of the quarter), so there is an inspiration among money managers to try to keep prices from falling which might delay a test of the Nasdaq 1745-1705 area.

The Nasdaq has immediate intraday resistance in the 1824-1835.53 area, then 1851-1874.

The S&P 500 has immediate resistance 1142-1157. resistance actually runs 1142-1174.

The S&P 500 has immediate support 1130-1126 which, when tested, will probably produce a short-lived lift. There is considerable support for the S&P 500 in the 1130-1107 area and if prices slip below the focus in the 1130-1126 area, this broader band has a focus 1119-1113 which should prevent further price deterioration.

Cherney is market analyst for Standard & Poor's

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