If historic price patterns are repeated during this consolidation, the S&P 500 should be able to post at least one close above the recent high close of 1097.43. In Wednesday's session, the Nasdaq managed to close above the 1722 level (its recent high close). The possibilities are good for another one or two closes above this level and not much downside risk for the next five to seven trade days.
Tuesday and Wednesday's price actions were confirmations that there are battle line for bulls and bears. For the S&P 500, that battle line is 1089.98 through 1107.12. If the market moves above the 1107.12 level then this area becomes temporary support. The next level of resistance is 1114-1135.52 and it is doubtful that prices can establish a close above the thick resistance (intraday, short-term) starting at 1123 and higher. (If the index manages to close above 1123 then I am going to have to re-assess my expectation that the current price action is just a sideways consolidation and not the beginning of another upleg.)
The battle line for the Nasdaq is 1722-1754. If there is a close above the 1754 level, then 1754-1722 becomes temporary support.
Immediate (intraday) resistance is 1733-1739.47 (1739.47 was Monday's intraday high).
Major resistance (brick wall, based on end of day data) is S&P 500: 1153-1199 (not expected to be tested in this upleg unless there is a powerfully positive headline related to the War on Terrorism or technical conditions improve.)
Major resistance for the Nasdaq is 1782-1934. Cherney is market analyst for Standard & Poor's