A Meandering Market?
By Paul Cherney
Wednesday's price action will probably see a little followthrough on Thursday, but anticipation of Dell's (DELL ) earnings (due after the close on Thursday) might create a market which spends much of the session just meandering sideways.
End-of-day indicators which update throughout the trade day real-time have not moved far enough for me to guess at anything more than that, but the price action on Wednesday did re-establish a more positive tone for prices.
Wednesday's intraday action was stairstep and during the recovery from the March lows, a stairstep pattern has given ground only grudgingly, so downside appears limited on Thursday.
The NASDAQ has a small ledge of resistance at 1967-1973.08 but the next layer of well-defined intraday resistance was established on Friday, Nov. 7 after the robust employment report -- that resistance is 1978-1992.27 with especially thick resistance 1984-1989.31.
Additional resistance is 1979-2011.25 which makes the 1979-1992 area a focus of resistance. Next resistance above 2011.25 is 2042-2073.
The next stairstep of organized S&P 500 resistance (above 1053.65) is 1055.64 to 1062.19 with a focus 1056.94-1060.79.
The S&P 500 has resistance established back in May of 2002 at 1058.67-1106.59. Price action on Friday stalled as it entered the lower portion of this band of resistance. Inside the 1058-1106 area, there is Brick Wall resistance 1068-1090 and the first price move into this area will probably be repelled.
The NASDAQ intraday support 1958-1942, this is stairstep support, additional supports are 1949-1941 and 1939-1923.50. Next support 1906-1892.
The S&P 500 has immediate intraday support 1055-1048.55. Stairstep supports are in place, the next supports are 1046-1043 and 1039.07-1029.19.
Cherney is chief market analyst for Standard & Poor's