In The Aftermath
S&Ps were trading down 1.20 at 1324.80 this morning, as the market continued to digest yesterday’s comments by Fed Chairman Greenspan, which all but took away the chance of further easings between meetings.
On the upside, we have 1325 and a key area at 1328; we need to get above and stay above this area to get the upside going. Then 1332.50 and a major at 1334.
On the way down, we have 1322.50, 1319.50, 1316.50, yesterday’s low at 1315, which is a key area, and a major area at 1312.
NASDAQ was trading at 2233, up 700. We had a very strong late sell-off, as we were trading 2312 and just before the final hour went straight down to 2212. What that means is that odds are increasing dramatically for a test of the contract low at 2115 set on Jan. 3.
For today’s trade, we have have support between 2210 and 2200. If we get under that, look for 2170, which was the intraday low made on Jan. 11.
The first leg of resistance which is going to be critical is 2245 to 2260. If we get above this, the key area will be the zone traded before the sell-off of 2290 up to 2312. Any settlement above 2312 is bullish.
The Dow failed once again at 11,000, but as long as we stay above 10,600, we believe this market is in pretty good shape.