Back in 1987-88, the S&P 500 was in an extended basing period, and that seems the logical path for current prices (in the intermediate term view meaning weeks).
The VIX has not moved back down through its 10-day exponential moving average. As of Monday's (Sept. 16) close, the 10-day moving average of the VIX finished near 38.98. So on Tuesday, a VIX move below 38.98 should coincide with a stronger market.
This is the week of the the September Triple Witch, when the monthly stock and index option expirations coincide with the quarterly expiration of futures contracts. This does have the potential to add some volatility, but the historical odds favor a positive bias unless something more dramatic occurs technically.
On Monday, the CBOE Total Put/Call ratio was 0.97 as of 3:30 pm EDT. That is high, and represents a building buying force. The Equity Only P/C was 0.81 as of 3:30 pm EDT. These are high and suggest that downside is limited.
The current market is a complex situation both technically and psychologically. I think in the short-run the downside risk appears limited versus the potential reward of higher prices sometime in the next 6 trade days.
Support: Immediate support for the S&P 500 is 890-875. Substantial support is at 876-833, with a focus of support at 868-854.
Immediate support for the Nasdaq is 1280-1265.
Resistance: Immediate intraday resistance for the S&P 500 is 892-898, then 909-928, with a focus at 923-928.
Immediate resistance for the Nasdaq is 1288-1298, then 1319-1350.92, with a focus at 1346-1350.92. Cherney is chief market analyst for Standard & Poor's