More Gloom…
S&P futures this morning were off 6.40 at 1235.60 on more economic gloom, including disappointing forecasts from Gateway and 3Com.
For today, S&Ps need to get above 1242 for the downside pressure to ease. We see resistance at 1242.50. Yesterday afternoon we made at least three tops between 1248 and 1250.
On the downside, we have 1231-1232; 1231 was yesterday’s low. Below that, we have a key area at 1228.50, major support at 1226.50, then 1223 and 1221.50.
NASDAQ is down 36 at 1877. We think the key levels, as we continue to erode, will be found between 1850 and 1800 in the CASH market. 1850-1800 in the cash equates very closely to the same price levels in the futures. One target today would be limit down, which comes in at 1848. We would expect to see support between 1855 and 1840.
On the upside, resistance is a little easier: 1905 to 1920 is critical. If we get above this, look for a move to 1960. We have resistance between 1950 and 1965.
As for the Dow, we’re neutral. Only a close below 10,300 will cause concern.