The Dow and S&P (first two charts below) held the .382 retracement levels off their recent lows today (8100 and 855), but 8250-8300 and 875-880 remain tough resistance levels. To the downside, 8100, 8000, 7970 and 7931 are support on the Dow, and 855, 852, 846 and 841 are support on the S&P. The Nasdaq (third chart) has now held the 1368 level three times. If that breaks, 1353-1360 and 1343 come into play. The 1400 level has been tough resistance. If Monday’s big decline is duplicated, downside targets would be 8000 on the Dow, 846 on the S&P, and 1343 on the Nasdaq. This morning’s gap down was met with a lot of put buying by equity option traders, which turned out to be a good indicator of a bounce.
Don’t miss the Company of the Week – every week – at http://www.wsrn.com/COW/.
Special report: For a free introduction to technical analysis and chart patterns, visit http://www.internetstockreport.com/guest/article/0,1785,2571_5/00051,00.html.