Technical Analysis: Last Year’s Lows Within Sight

The Dow and S&P (first two charts below) are closing in on their lows of last year. For the Dow, 7450-7500 and 7200-7275 are support, and resistance is 7600, 7650 and 7725. The S&P has support at 800 and 768-775, and resistance at 817-818, 822 and 830. The Nasdaq (third chart) is still a long way from last year’s lows. It has support at 1260-1263, and resistance at 1280, 1292 and 1300. The Transports (fourth chart) are testing the Sept. 2001 low of 1942; a break of that level would be a bearish sign for the market. With yesterday’s 90% downside day on the NYSE, a short-term bounce remains a possibility. Historically, major bottoms have averaged five such days, so it’s a good sign that we got one, but there should be more coming at some point.

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