I think it was a constructive day for the bulls today not because of the small gains but because of the intraday reversal. The Nasdaq had the best action because it fell all the way back down to Tuesday’s close, thereby closing the Wednesday morning gap. (I pointed out that gap on the intraday chart that I posted on Saturday.) The problem (if you’re a bull), once again, is that volume was light. So today may have been a slight victory for the bulls, but there are three important levels on the Nasdaq just above — the 200-day moving average, the 2,000 level and then the 2,005 area, which has been a cap for about two weeks now. Things could get interesting if the Nasdaq can close above 2,005. I think we’d get some short covering triggered by that event.
