Technical Analysis: Two Steps Forward
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The market remains choppy, but at least it's heading in the right direction.
As we noted earlier this month, the pattern after a financial panic tends to be a choppy rise as bulls slowly regain confidence, and that's so far what we're seeing, as the indexes push to new highs, hit resistance and then fall back.
The Nasdaq (first chart below) stalled at 2550 resistance today, with 2570-2600 above that. To the downside, if 2500 support goes, the index could be headed for 2430-2450.
1415, 1400 and 1384-1387 are support for the S&P (second chart), and 1450 is tough resistance.
The Dow (third chart) continues to lag, stalling at its recent high at 13,132-13,137. A break through that could give the index room to 13,500. 12,900-12,950 is support, with 12,743 below that.
Paul Shread is a Chartered Market Technician (CMT) and member of the Market Technicians Association.