Positive Conditions for Stocks
By Paul Cherney
Immediate downside risk appears limited.
Seasonal strength and a lack of any real selling pressure suggest that a majority of investors are probably more willing to risk a random day of retracement while maintaining long positions in anticipation of additional upside before the end of the year.
Downside risk appears limited and prices should try to work a little higher. It would not be a surprise, though, at any time, to see prices make a small dip, closing with a loss on the day.
Immediate Nasdaq resistance starts to get thick at 1,956 and higher. Resistance becomes very thick at 1,966-1,978, but runs all the way to 2,011.25.
Immediate Nasdaq chart support is 1,931-1,923.09. More substantial support, which stemmed the decline in prices on Wednesday, Dec. 9, is 1,916-1,878, with a focus at 1,907-1,896.
The S&P 500 has a brick wall of resistance at 1,068-1,090, but prices have room to move higher inside this brick wall. Technically, immediate resistance (based on end-of-day data) runs all the way up to 1,106.
Immediate support for the S&P 500 is 1,068-1,065, which held in Friday's market as the intraday low print was 1,067.64. Additional support is 1,060-1,052.
Cherney is chief market analyst for Standard & Poor's