Technical Analysis: The Chips Hang On
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The chip index (first chart below) bounced today just above a critical support - 393.8, the top of the index's first leg up off the October 2002 lows. Below that, and Elliott Wave theorists would view the index's 15-month rally as corrective, meaning that new lows would be likely on the index eventually. The Nasdaq (second chart) would need to fall to 1521 to reach the same critical point. The index lost another support level today at 1840-1842. Below today's low of 1829, the next major support levels are 1812-1814 and 1776-1792. Resistance is 1860, 1865-1870, 1883-1889, and 1894-1900. The S&P (third chart) held above its may low of 1076; below 1075, the index has support every 5 points down to 1050. Resistance is 1090-1093, 1096, 1100 and 1106-1107. The Dow (fourth chart) has support at 9900-9914 and 9852, and resistance is 10,000-10,008, 10,062-10,075, 10,162 and 10,215-10,220.