Here is the tech stock analysis from Briefing.com. I highlighted the part about "support levels"
Tech Stock Analysis
Updated: 03-Jun-02
General Commentary
It looks like Summer has come early -- at least as far as the markets are concerned. Over the past five sessions, Nasdaq volume has failed to surpass 1.6 billion shares and two of those sessions marked the thinnest trading conditions of the year. While last Summer's trading range of Nasdaq 2,000 to 2,200 felt slow, we'll now see how things go starting from the 1,600's. We don't frequently review the gory details, but at current levels, the Nasdaq is off roughly 68% (give or take a tenth of a percent) from its all time high of 5,132 touched on March 10, 2000.
While we all wonder what's wrong with the markets, it may be as simple as the market has been extremely challenging of late. To place things in context, a 10% dip qualifies as a correction whereas a 20% slide typically registers as a bear market. So by all accounts this 68% slide in the Nasdaq over 27 months amounts to one steep and prolonged market crash. And while the plurality of data continues to point towards a steadily improving economy, it looks like few traders are seeking to pick the bottom at this point.
Looking towards the week ahead, there are a few potential catalysts worth mentioning. On the economic front, the ISM (Institute for Supply Management) Index -- a measure of activity among purchasing managers -- is set for release Monday. Later in the week, the marquee May Employment Report will be released Friday before the market open. A sharp deviation versus expectations in either number could set the near-term market tone accordingly. And while the earnings calendar remains relatively light, National Semiconductor (NSM) is scheduled to report on Thursday during market hours. This report has been known to generate tradeable opportunities and is at least worthy of a mental note.
On a quick technical note, the weekly chart on the Nasdaq suggests 1600/1613 is looking like relatively important support. This area served as support/resistance bracketing the reaction lows in September and also held on a quick test during the first week of May (again this is the weekly chart, not the daily chart). If 1600/1613 can hold on a closing basis next week, the markets may be situated for a tradeable rally. The flip side of this coin is that failure at 1600 likely means a test of the May lows, and an additional waiting period for those seeking the next leg higher.
Mike Ashbaugh |
