March 10, 2008
The week was expected to be conducive to a reflexive bounce in the market from the hard sell-off in the indices from the week prior. Instead, investors allowed themselves, due to a series of downgrades to companies with mortgage exposure, to once again, begin another round of selling, and in the case of the NASDAQ, close below its lows that were established in January. We are definitely at a crossroads at this point. The NASDAQ is leading the way to the downside, and is showing signs of further deterioration. The S&P is right behind it, closing just above its lows from January. The bears at this point are foaming at the mouth, in hopes of triggering the stops of investors who have them placed below the lows from January.
Let’s review the charts…
NASDAQ entered dangerous territory today, as it broke through the support levels from the January lows, and is now poised for another leg down. However, despite the technical breakdown of the index, and due to the oversold conditions of the NASDAQ, we may have an intraday rally of sorts in the days ahead, especially with the light news week that is in store
CLICK HERE FOR THE NASDAQ CHART
S&P, even though the chart, is in complete disarray from a bullish perspective, is nonetheless, doing better than the NASDAQ, and will use this week as an attempt to hold its lows from January.