Technical Analysis: Signs Of Distribution

With volume rising on a down day and stochastics on all indexes overbought, the technical picture deteriorated today. The Dow (first chart below) held 7900 support today. If that goes, 7750-7775 is critical. First resistance is 7975-8000. The S&P (second chart) has support at 835 and 827, and resistance at 842-843 and 850. The Nasdaq (third chart) has support at 1320 and 1300, and resistance at 1346-1349 and 1360-1362. The semis (fourth chart) have failed to close back above the neckline of a head-and-shoulders top despite two straight days of Wall Street upgrades. Tomorrow is options expiry, so it could be a volatile day. Odds favor the QQQ, the Nasdaq 100 tracking stock, ending the day below 25, the level where most options would expire worthless.

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