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Technical Analysis: Dow Hangs On

The Dow (first chart below) hung on to its narrow trading range at today's low (11,659), but weakness in the S&P and Nasdaq (second and third charts) needs to be reversed to give the blue chips another crack at their all-time high of 11,722-11,750. First-of-the-month inflows were of little help today, a sign of a lot of overhead supply here. Below 11,659, 11,630 and 11,590 are the next support levels, with 11,590 critical. The S&P (second chart) faces resistance at 1333-1337 and 1340, and support is 1329-1330, 1327, 1321 and 1316. The Nasdaq (third chart) has support at 2230 and 2222, and resistance is 2253, 2258, 2263 and 2273. Interesting to note that Gerald Appel's Nasdaq relative strength indicator (fourth chart) remains on a buy signal from early September. So much for the reversal in bond yields (fifth chart).