Technical Analysis: Back To Resistance In A Day

Quite a day. The Nasdaq (first chart below) made it all the way back to critical 1353-1355 resistance. If there’s a warning sign there, it’s the 92% upside volume – a little too much exuberance can make for a blow-off top (the flip side is that another 80% upside day on the NYSE tomorrow would be bullish). It’s hard to find a good support on the Nasdaq at this point until 1297-1300, and given that the QQQ, the Nasdaq 100 tracking stock, is way above options Max-Pain (under 25), there could be some downside over the next week or so. The Dow and S&P (second and third charts) face significant resistance at about 7860-7870 and 837-838. Support on the Dow is 7750 and 7650, and on the S&P at 830 and 822. The ten-year treasury yield (fourth chart) closed right at resistance. The SOX (fifth chart), the semiconductor index, broke though a ton of resistance today and is the most bullish-looking of today’s charts. Now it has to hold those breakouts. Negatives today include a decline in new highs on the NYSE and the preponderance of declining issues at the top of the NYSE most actives list. Not the stuff of which lasting rallies are made.

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