Technical Analysis: S&P Breaks Support

The S&P (first chart below) closed below the important 839.50 level today, the 61.8% retracement off the October low, but it also seems to have found support at a falling trendline. That line will be at about 830 tomorrow; if it goes, the downtrend would likely accelerate. Resistance is 845, 850, 860 and 865. The Dow (second chart) pierced its 61.8% retracement (7902.60), but found support at the lower trendline of a bearish broadening pattern. That lower trendline will be at roughly 7855 tomorrow; if it goes, 7725 looks like the next support. Resistance is 8000 and 8158. The Nasdaq (third chart) continues to cling to 1300 support. Below that, 1263-1273 is the next target, and 1315-1320 and 1332-1335 are resistance. January’s employment report comes out tomorrow morning and is expected to show the first jobs gain since October. The equity-only put-call ratio continues to be affected by massive paired trades in 2005 QQQ puts. After factoring out those trades, the equity PC ratio appears to have been .62 yesterday and .69 today. Not bad, but closer to .80 would be better.

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