If the VIX (market volatility index) can start trending below the 37.50-37.28 levels, a more enthusiastic short-covering effort will be underway, but this would probably be just a short-term event (maybe only lasting for Tuesday) unless there is a headline which specifically advances (favorably, or interpreted favorably) the situation with Iraq.
These markets remain susceptible to headlines both good and bad. Sentiment can turn in an instant, forcing leveraged players to cover and enticing longer-term investors to try the long side, but any violent upside move in prices will probably only be a short-term affair until something more definitive unfolds with regard to Iraq.
The Nasdaq has immediate intraday support at 1287-1275.
The Nasdaq has a well defined shelf of resistance at 1302.80-1311. Immediate resistance above 1311 is 1333-1345. The index has substantial resistance at 1358-1383.
The S&P 500 has a shelf of resistance at 832-835.72; more substantial resistance is 838-845.88. Next resistance for the S&P 500 is 857-868.62, and becomes thick at 862-868.72. Cherney is chief market analyst for Standard & Poor's