The Nasdaq’s underperformance (first chart below) is becoming quite a problem for the market here. While the rest of the market rises on takeover speculation, the techs are falling on slowdown fears — doesn’t seem like a recipe for an enduring advance, but commercial long positions in the S&P suggest that the market should be okay for a couple more months. Still, if the Nasdaq goes below 2500-2510, we could be in for a bit of a correction. 2523 is first support, and 2532, 2544 and 2560 are resistance. The S&P (second chart) faces difficult resistance at 1516, but first support at 1498-1500 is so far holding. The Dow (third chart) is facing some psychological resistance at 13,500, and 13,240 is important support. Strange reaction by bond traders (fourth chart) to today’s inflation data. Doesn’t look like they expect inflation to remain restrained. On the plus side, perhaps growth will pick up too.
