Technical Analysis: Getting There
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Once again, the market gapped down into oversold territory but didn't stay there. As Charles Dow first remarked more than 100 years ago, the positions that traders are willing to stay with overnight are most significant. For that reason, closing at or near the lows when the market is oversold gives the market a better chance at a reversal than if the market reverses on an intraday basis. Perhaps with Microsoft's disappointing corporate business, we may finally get that capitulation tomorrow. The Nasdaq (first chart) has resistance at 1893-1900 and 1915-1920, and support at 1874, 1860-1865 and 1840-1842. The S&P (second chart) has support at 1025, 1015-1018, 1010 and 1000, and resistance is 1035-1040. The Dow (third chart) has resistance at 9622 and 9700, and support at 9552 and 9500.