Testing Process Continues

The stock market continues to test underlying support levels formed during the summer. The first chart (below) shows the Dow Industrials holding chart support along the 16,000 level. The second chart shows the Nasdaq Composite holding support along its August 25 closing low at 4500.  The last chart shows the S&P 500 testing its August intra-day low. The testing process is likely to continue well into the month of October. So far, those support levels are holding. However, all three stock indexes remain below their mid-September peak and falling 50-day averages. Sooner or later, those levels will have to be exceeded if the market trend is going to improve.

- John