Well, we know what tomorrow’s headlines are going to read: “Dow Tops 10,000.” The question is, what will the reaction be? Our guess is that investors may begin to relax – and thus we may begin to see greater complacency creep into the market, a potential negative to watch for. The Dow’s finish was wobbly today, and it took a great deal of effort to get the 10,000 close, so don’t be surprised if the market pulls back from here. The Dow and S&P (first two charts below) are nearing overbought levels – and since they didn’t close at oversold levels, the odds are reduced that they will make it to overbought levels on a closing basis. The Dow closed right at 10,008 resistance, the .618 retracement level off the index’s all-time high. Above that, resistance is at 10,026, 10,050-10,060, 10,100 and 10,200-10,250. Support is 9980, 9950 and 9900. The S&P faces resistance at 1074 and 1083-1093, and support is 1067, 1064 and 1058-1060. The Nasdaq (third chart) has resistance at 1950, 1958-1960 and 1967-1972, and support is 1935, 1930 and 1915-1920.
