NASDAQ Approaches Major Resistance

Above is a weekly chart of the NASDAQ 100 ($NDX). As you can see the NASDAQ is enjoying a spectacular rally over the last 10 weeks but is now closing in on major resistance. Back in the spring of 2008 the NASDAQ established its high for that year and then subsequently sold off precipitously. We are now rapidly approaching this 2008 resistance level.

The big question is whether or not the NASDAQ will fail at this level or bust through. Nobody knows the answer to that until it actually happens however given the fact that the market is overbought with declining volume, I wouldn't be surprised to see this level hold. Many times when a market is overbought going into a first time test of resistance, the resistance level tends to hold. Lets see what happens.