If the VIX (volatility index) can drop under 30.25 intraday, it should coincide with a rebound in prices. It would be more important for the VIX to close below 30.25 to suggest that a turn is in the making.
There is limited downside. I think the lows for this downleg (the downleg of the past 8 trading days) have already been registered.
The Nasdaq has immediate resistance 1449 to 1491, with a focus 1480-1486. The 1496-1540 area looks like the best the Nasdaq could achieve in the first lift-off. This area (1496-1540) looks like a likely spot for some concerted profit-taking. There is a congestion of prices 1519-1538.36. The next resistance is then 1554-1595 with a focus of resistance 1560-1570. Then thick resistance (above 1595) is 1620-1654.
The S&P 500 has immediate resistance 987-1005.58, then 1010-1019, then 1025.93-1039.09. There is a focus of resistance 1032-1037.80. There is thick price traffic 1039-1047. The next resistance is 1065-1088.
Immediate Nasdaq support is 1443-1423 with a focus 1438-1432, then 1414-1394. I have looked at long-term charts for the Nasdaq and the 1380-1200 area looks like a solid band of support which will act as a floor for prices. (The 1380-1200 layer is from the years 1996-1997.) I do not think the index (even if it sold off horribly), could manage more than one close below 1387.
Immediate intraday support for the S&P 500 is 980-971.29 then 960-952 (and the entire price range from Sept 21, 2001 which means there is support down to 944). I do not think the S&P 500 could have more than one close below 944.75. I have looked at long-term charts of the S&P 500 and we are at the level 960-926 (form late 1997) which should act as a floor for prices.
The Sept. 21, 2001 price ranges were:
S&P 500 intraday high 984.54, intraday low 944.75, close 965.80 Nasdaq intraday high 1454.04, intraday low 1387.06, close 1423.19 Cherney is chief market analyst for Standard & Poor's