Looking at the moving average convergence divergence line, or MACD, an important momentum indicator that analysts often use to predict where a security is headed, Garner says that even when the Nasdaq has stabilized the MACD continued to decline. That's a bearish sign.
Also, she says the Nasdaq is nearing strong levels of resistance on the upside. She notes the first level of resistance is 3,742 while the second level of resistance is 3,813. Largely, trendlines suggest to Garner that the ceilings will not be pierced by a short-term rally. In turn, Garner believes the subsequent selling could be brutal.
Turning attention to the S&P 500, she says the index has been trading in the same upward channel for a year now, and at the moment, the high-end of the channel forms a ceiling of resistance at 1,930. Garner believes the chances of the S&P breaking out above that 1,930 level are pretty slim.
In addition, Garner has analyzed the seasonal performance of the S&P 500 over the last 10 years, and found that from May through October the S&P's performance has been weaker as compared to January through April. Therefore, she believes investors may follow the adage and "sell in May and go away."