Already a Bloomberg.com user?
Sign in with the same account.
By Paul Cherney The line of least resistance should still be for higher prices for another 10 trade days. The momentum generated by the lift off the 4/4/01 bottom should still have some residual (positive) effects on prices.
Immediate resistance for the Nasdaq is 2039-2096 with a focus 2052-2078, resistance actually runs all the way through 2111. The index has another layer of resistance 2143-2182.
The Nasdaq finished Tuesday's session in a test of the 2030-1995 area of support. The next substantial layer of support (based on the charts) is 1962-1868. I cannot rule out a retracement in the Nasdaq which prints in the 1962-1868 area. We just had a fourth consecutive rate cut by the Fed. Historical odds based on price performance in the wake of a fourth rate cut by the Fed puts downside risk (over the next year) for the Nasdaq for a close of 1875.
The S&P 500 now has immediate resistance in the 1223-1238 area. The index has immediate resistance in the 1253-1273 area. The index finished Tuesday's session in a test of support in the 1212-1202 the next support is 1193-1158. My "worst case" expectation for this retracement is a close near 1168. Historical odds based on price performance in the wake of a fourth rate cut by the Fed puts downside risk (over the next year) at a close of 1140. Cherney is Market Analyst for Standard & Poor's