Markets & Finance

Odds Favor Gains on Tuesday


By Paul Cherney I can't argue with prices when volume is in attendance. The price action in the Nasdaq on Monday looked very good. I may have simply been wrong with my concerns about a limited upside.

Intraday measurements of price and volume for both the Nasdaq and the S&P 500 suggest that the odds favor higher prices again on Tuesday. Any weakness near the opening will probably be greeted by the markets as a buying opportunity. One chart pattern which I have seen unfold in similar situations is 3 or 4 trading hours of net gains, then minor retracements with a flat market on the next trading day (Wednesday) before a a persistent two day rise. If this pattern does unfold then Thursday and Friday would correspond to the days that can see consistent momentum to the upside.

The DJIA has a focus of resistance in the 11,400-11,750 area (The record high close for the DJIA was 11,722.98 on Jan 14, 2000.)

Immediate support for the Nasdaq is 2285-2268. The Nasdaq has made a bullish break above a well-defined area of consolidaiton in the 2233-2174 area and this is now substantial support. The index finished Monday's session near the upper edge of a focus of resistance in the 2253-2310 area, this is part of the 2242-2356 band of resistance.

The S&P 500 has entered the next area of resistance: 1300-1341. Within this layer is a focus of resistance 1311-1339, and this still looks like a likely spot for the current advance to start to lose some upside momentum. The S&P 500 has immediate closing support 1295-1284 then 1273-1253 area.

Downside apppears limited. Cherney is Market Analyst for Standard & Poor's


We Almost Lost the Nasdaq
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

Sponsored Financial Commentaries

Sponsored Links

Buy a link now!

 
blog comments powered by Disqus