The intraday highs from Monday were Nasdaq 2,111.43, S&P 500 1,194.78.
The markets are waiting for a headline to generate a reaction (bullish or bearish).
The seasonal strength for the month of January favors a positive bias for prices but one aspect of a positive market is the ability of prices to sequentially break above
resistance levels, and these markets have not demonstrated that ability yet.
supports for the S&P 500 are 1,188.61-1,182.16 and 1,184-1,180.40; that makes the 1,184-1,182.16 area a focus of intraday support. These prices are inside a layer of support that overlaps at 1,186-1,167, really all the way down to 1,160.36, which is why short-term downside is probably limited, because there is so much price traffic in this area. Next support is 1,142.05-1,090.19.
There are multiple layers of support for the Nasdaq, too. Immediate intraday support for the Nasdaq is 2,096-2,076.69, with a focus of support at 2,097-2,090.97. Another layer of support is 2,085-2,052.80 and that makes the 2,085-2,076 area a focus of support.
S&P 500 resistance is 1,185-1,195, then 1,205-1,209.53. There is more formidable resistance from July, 2001. The older the resistance, the less precise you can be, but here is the read from the 60-minute charts from July and August of 2001: resistance is 1,215-1,226.27.
Nasdaq resistance is 2097-2118 then 2132-2152, stacked shelf at 2155-2165.
Longer-term measures of price combined with volume have weakened to neutral readings, but there is usually a lingering positive bias after the kind of lift we saw in the 4th quarter. And these measures have stopped weakening. Some sort of a wave of buying should occur in January, the question to be answered (if there is a wave of buying) is: will a lift in prices draw additional buyers into the markets. An attempt to answer that question can only occur once there is an opportunity to measure the volume and breadth of a move higher. I can't measure the internals of a lift in prices until one occurs, but those measures might afford me some insight into the ability of a lift to followthrough higher.
Anytime resistance is exceeded it must be treated as support until broken. Anytime supports are broken they must be treated as resistance until exceeded. Cherney is chief market analyst for Standard & Poor's