Technical Analysis: Another Rally Fades
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Three straight days that fail to take out a large down day is rarely a good sign, which is the set-up we have since last week's Federal Reserve-inspired sell-off. Once again, the one hope is that end-of-the month inflows could help support the market. Another down day would set up a "falling three methods" bearish continuation pattern. The Nasdaq (first chart below) faces tough resistance at 2000-2008, with 2023 and 2040 above that. Support is 1985, 1970 and 1940-1950. The S&P (second chart) faces tough resistance at 1180-1185, and 1164 is major support. The Dow (third chart) has major support at 10,368-10,376, and resistance is 10,534, 10,600 and 10,663.