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Technical Analysis: Nasdaq On Shaky Ground

The Nasdaq and Nasdaq 100 (first two charts below) put in bearish evening star reversal patterns today, a three-day candlestick pattern that has marked many a top in the indexes over the last few years. That said, sentiment became somewhat more supportive today, with the equity-only put-call ratio closing at .77 today, a considerable improvement over the .48-.51 levels of the last two days. And with expiration a week away, puts now outnumber calls at the 26 strike price on the QQQ, the Nasdaq 100 stocking track, an abrupt shift from yesterday. That could give the index another run at yesterday's highs, provided that call buyers don't jump right back in. Resistance is 1423 and 1440-1449 on the Nasdaq, and support is 1395 and 1380. 1330 is critical support. In the smallest timeframes, the S&P (third chart) has a trendline across the highs that could provide a bounce if broken. Almost any move up tomorrow would break that line. Resistance (fourth chart) is 923-925 and 930, and support is 900-905. the Dow (fifth chart) has resistance at 8735-8800, and support is 8580 and 8500.

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