Technical Talk: S&P 500 Index – no clear-cut direction

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The comments below were provided by Kevin Lane of Fusion IQ.

As seen below on the 31-day S&P 500 chart, the index remains in a minor uptrend (green line). However, it is also below a resistance zone (dotted red lines and arrows) near the 1,105-1,112 region. Until the index either breaks above this resistance or below the uptrend line the S&P 500 will remain fairly directionless.

The next big support area for the index lies in the 1,080 area (blue line). Only below this support level would things get slippery again.

Without any clear-cut direction in place yet it makes sense to not take any big swings here.

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Source: Kevin Lane, Fusion IQ, March 1, 2010.

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5 comments to Technical Talk: S&P 500 Index – no clear-cut direction

  • Leo

    A breath of fresh air – every blog has turned super bullish. No one discussing that even with the short term bounce, we are still without direction. Nice job. Enjoy your work.

  • Our behavioral model actually shows support over TRADE (3 wks) and TREND (3 mos) durations at 1105 and TRADE resistance at 1122, which the market is bumping up on as I type.

    But on the core point, correct — it’s a tight and tradeable range, one in which paying attention to risk in real-time is required. http://www.hedgeye.com

  • Frank W

    The S&P 500 has clearly broken primary uptrend.

  • Graham

    Given the breach of the resistance he indicated Mr Lane’s work now suggests that we’ve broken out of the narrow trading range he initially identified on the 1st. So rather than no direction perhaps Mr Lanes analysis now points towards an uptrend.

  • With two failed attempts on the day to break and sustain above the 1122 resistance line, our TRADE resistance is holding, which we’ll refresh in the morning on our Macro call.

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