It probably would have been best if BUBBLE ben bernanke would not have made this trip to Jackson Hole to speak, there is way too much stress at this moment on the markets for what he is or isnt going to say. There is going to be major, major, major volatility going into this meeting. This will cause markets to swing wildly in both directions for weeks. As for Nasdaq 2000 I think its been a possibility for quite sometime. Nasdaq Could Drop to 2000 on Jackson Hole Disappointment: Charts Published: Tuesday, 23 Aug 2011 | 8:00 PM ET Text Size By: Daryl Guppy CNBC Contributor Will Friday's meeting at Jackson Hole dig markets deeper into a hole, or get the U.S. out of one? Given that it's already a pretty deep hole, the balance seems to be tipped towards further drops. However a shovel powered by some type of QE3 may well be enough to get us out of this situation. The leading indicator of how this will develop is the Nasdaq. Media attention and popular opinion is focused on the Dow, but itâs the Nasdaq that leads the U.S. market behavior so itâs the NASDAQ that will provide the early warning signals. We apply our analysis therefore to the Nasdaq. The first delivers a ho-hum result. The second sets some targets if the outcome leads to a further market hole. The third sets some upside targets if the meeting is able to pull a recovery rabbit out of the hat. These reactions will also feed quickly and directly through the currency markets. The U.S. Dollar Index and the Eurodollar are all poised with symmetrical triangle patterns. These patterns show indecision, but also the ability to move rapidly and explosively in a breakout. Because they are symmetrical, the probability of an upside breakout is evenly balanced with the probability of a downside breakout. Let's start with the ho-hum result. We would expect to see a retest of support near the 2300 level. This has two support features. First, this is the target for the measured downside move from the head and shoulder trend reversal pattern in the Nasdaq. Itâs a powerful target level because it is also the top of the trading band that developed between June 2010 and October 2010. A ho-hum result is a consolidation around this level. Consolidation occurs when the volatility of the bounces â the rallies and retreats â is reduced and stabilizes. Call it an âLâ shaped type of recovery. Digging the hole deeper means breaking below the support level. Here we look for the bedrock of historical support. There are two ways to determine this. The first is the lower edge of the trading band located near 2100. This is not a large hole, but nor is it the technical target calculated by doubling the initial head and shoulder target. In 2008 these double target projections were reached and exceeded. The double projection is around 2000 but this level has no history of support. This suggests the potential to crash to 2000 but then rebound and consolidate around the 2100 level. Freefall below 2000 has a target near 1690. We need to see the nature of this fall before the relevant behavior patterns can be extracted and this target confirmed. Magic sometimes happens, and in these extraordinary markets everything is possible, but realistically itâs a hard slog back to the top. There are layers of overhead resistance that have to be broken. The first resistance level is near 2690. This is the projection of the neckline for the head and shoulder pattern. It is also the value of the lower edge of the long-term Guppy Multiple Moving Average (GMMA). This captures the activity of investors. When they join the selling, the trend is confirmed. The wide spread in the long term GMMA provides considerable resistance for any market recovery. Think of this as pushing through an airbag of resistance. The further you penetrate, the stronger the resistance pressure. The upper edge of this is near 2750. The head and shoulder pattern on the NASDAQ is shallow. The shoulders are nearly as high as the head, and some analysts have described this as a triple top pattern. We think the slightly higher head is significant. Either way, there is strong resistance near 2850 to 2900. It's harder to go up then it is to go down. Traders will use the NASDAQ behavior as the leading signal for market reactions going into, and following the Friday Jackson Hole meeting. Daryl Guppy is a trader and author of Trend Trading, The 36 Strategies of the Chinese for Financial Traders âwww.guppytraders.com . He is a regular guest on CNBC's Asia Squawk Box. He is a speaker at trading conferences in China, Asia, Australia and Europe.