Technical Analysis: Bulls Chip Away
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Buyers are finally making some progress against significant resistance here, but they still have quite a bit of heavy lifting ahead of them. One positive to note here is that the Investors Intelligence weekly survey showed bulls and bears narrowing to 40.6 to 37.4, a whole lot of skepticism to base a rally on. The Dow (first chart below) faces resistance at 13,300, 13,350, 13,400, 13,500 and 13,700, and first support levels are 13,200 and 13,150. The S&P (second chart) finally took out its 200-day average at 1455, which is now first support, but the index faces a big test tomorrow when it opens right at its main downtrend line. The Nasdaq (third chart) will also open right at its main downtrend line tomorrow morning two very interesting set-ups heading into the morning. First support is 2525-2535. The ten-year yield (fourth chart) remains stalled, but it has a long way to go to break out of its down channel.
Paul Shread is a Chartered Market Technician (CMT) and member of the Market Technicians Association