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By Paul Cherney This comment looks similar to yesterday's because the technical condition of the market has not really changed: the trend for prices remains positive. A retracement would be natural at any time. End of day momentum measures suggest that any short-term price weakness should attract buyers, not sellers, so downside risk should be limited.
A buyers capitulation might have to occur to signal a greater potential for some retracement in prices. For a buyers capitulation I would have to see a day of gains while the total NYSE trading volume for the day was 1.75 billion or higher and the trade day was accompanied by a sharp drop in the VXO to a close under 12.60, that might be a sign that short-term buying demand has been sated.
Any price weakness would NOT change my expectations that a retracement should be limited in depth and duration.
The NASDAQ resistance 2049-2094, resistance thickens 2079-2094, next resistance 2108-2153.83.
Immediate intraday NASDAQ support is 2055-2025.71, support thickens 2036-2027.69. Next intraday support is 2020.67-2002.
S&P 500 intraday support: 1177-1160, support is thick 1170-1160, the next layer of organized intraday support is 1147-1138.50.
The S&P 500 has thick resistance 1185-1226.
We are at the beginning of what has been historically, on average, the 3 best performing months of the year -- November through January. Cherney is chief market analyst for Standard & Poor's