Indices Technical Forecast: Bearish
- S&P 500 flush of Feb low was short-lived, lower levels look to be ahead
- Dow Jones Feb low looks set to get taken out at 32272
- Nasdaq 100 leading the way, looks headed much lower in weeks/months ahead
S&P 500 Technical Forecast
The S&P 500 flushed the Feb low last Monday, and on that it set it up for a rally. We got the Fed on Wednesday which further gave the market legs, but then those got chopped out from underneath the day after the FOMC meeting. Bear market rallies are violent but short.
Heading into a new week the market remains in the same position it was heading into last week – vulnerable. At this juncture it will take a lot to turn the tides around towards a bullish bias. In the event the market can muster up some more strength, the 4308 level is a good one to look for the market to fail at.
As far as support goes, below the monthly low there isn’t anything highly meaningful to point to at this time.
S&P 500 Daily Chart
Nasdaq 100 Technical Forecast
TheNasdaq 100 is the leader, and on that with it acting as poorly as it has it suggests we are in for a much larger decline. The outlook is generally bearish with a tactical approach towards selling failing rallies. On a bounce from here look for resistance around last week’s high of 13556. I wrote about the bigger picture on Friday and how the long-term chart highlights an extremely bearish outlook.
Nasdaq 100 Daily Chart
Dow Jones Technical Forecast
The Dow Jones is trying to hold onto its February low at 32272, but it feels like it is inevitable that the lows will get clipped. We may first see a bounce develop before taking out the lows, but the rally isn’t likely to hold much staying power. In the event the market can get a little wind in its sails, look for resistance to be strong around the 34100 level, its been support and resistance on a few occasions since mid-April.
Dow Jones Daily Chart
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—Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at@PaulRobinsonFX