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Technical Analysis: A Retest?

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Paul Shread
Paul Shread
Aug 14, 2004

The Dow and S&P (first two charts below) found support today near their recent lows, and on declining volume too. So was today just a retest of the lows? The market needs to bounce soon, or it could be just a consolidation in a downtrend, with more downside to come. Perhaps Monday will see stronger upside; Fridays have been nervous days in the market for some time. Sentiment continues to look good among options traders. To cement a bottom, the recent highs would have to be taken out — that would be 9954 on the Dow, 1079 on the S&P, and 1808 on the Nasdaq (third chart below). The Nasdaq needs to hold 1750 support; if that goes, 1737 and 1685-1700 come into play. Resistance is 1770-1775, 1787 and 1800. The S&P has resistance at 1067-1070, 1075-1076 and 1079, and support is 1050-1060. Below 1050, 1030 and 1015-1018 would come into play. The Dow has support at 9783, 9750, 9700 and 9650, and resistance is 9852-9858, 9900 and 9954.

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