S&P 500 : Will it turn now?

Yesterday’s continuation of S&P 500 rally has seen it reach a very important milestone.

On the chart, it has pierce through 828, but not with strong volume.

The missing volume is a critical factor as this is a level that has been tested 3 times this year before it finally break down.

Just as it is difficult to break down, I believe it  will be also face difficulties breaking through convincingly.

More importantly, we can see that S&P has now ‘slammed’ into the wall of kumo. 

I guess, the market is looking for catalyst next week. Perhaps the G20 meeting next week is a good catalyst to help it break through.

Nothing much has change since Geithner’s announcement of the ‘bad bank’ rescue plans. The economy is still not doing well.

We can’t expect S&P 500 to continue soaring and making new high, can we?



S&P 500 : Week ending 20 March 2009


S&P 500 has a distribution day on 20th March 2009. 

We can see that S&P continue to face resistant at the 800 level. A break through above this level could suggest continuous ‘up trend’. However, we need to be careful about a continuous ‘bear rally’.

With this turn, the chart is suggesting the rally is losing its momentun.

We might see it move down and rebound off the support level at 675 (as shown by the chikou span – green line).

Most likely, we will see a rebound off a lower level, and what we want to monitor is whether the index break out of the 675 – 800 trading range.