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Technical Talk: Any bounce to be short-lived

Posted By Prieur du Plessis On August 18, 2010 @ 11:53 am In Investment,Stocks | No Comments


The comments below were provided by Kevin Lane of Fusion IQ [1].

As seen in the chart below, the S&P 500 is now down 4.25% after violating its uptrend line (green line). The sell-off has been on low volume, commensurate with the summer malaise. Given the short, quick sell-off we would expect some counter-trend rally to develop here for a few days. However, given the larger macro issues and the backdrop of September/October looming we expect any bounce to be short-lived and revert lower in relatively short order. The most im­portant longer-term resistance level remains near 1,129 (red line)

Near-term resistance comes into play near 1,087, followed by 1,096 and then 1,106 (see 31-day chart below). We think any over­sold bounce can reach the latter two levels before reverting lower.

S&P 500 Index – daily chart

[2]

S&P 500 Index – 31-day chart

As seen above in the 31-day chart there are three possible levels of resistance on any rally attempts: 1,087 (red line), 1,096 (purple line) and 1,106 (orange line).

[3]

Source: Kevin Lane, Fusion IQ [1], August 17, 2010.


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More on this topic (What's this?) [5]
Why We May See a Rally in U.S. Stocks [6] (Money Morning, 12/19/11)
Stocks Keep Rallying [7] (Random Roger's Big Picture, 2/14/12)
Stick To Your Plan [8] (The DIV-Net, 2/16/12)
Read more on S&P 500 (SPX) [9], Airiq Inc [10] at Wikinvest [11]

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URLs in this post:

[1] Fusion IQ: https://www.fusioniqrank.com/signup.php?a=3

[2] Image: http://www.investmentpostcards.com/wp-content/uploads/2010/08/TT1808-PIC1.jpg

[3] Image: http://www.investmentpostcards.com/wp-content/uploads/2010/08/TT1808-PIC2.jpg

[4] Did you enjoy this post? If so, click here to subscribe to updates to Investment Postcards from Cape Town by e-mail.: http://www.feedburner.com/fb/a/emailverifySubmit?feedId=921608&loc=en_US

[5] (What's this?): http://www.wikinvest.com/blogger/wikinvest_wire

[6] Why We May See a Rally in U.S. Stocks: https://moneymorning.com/2011/12/19/why-we-may-see-a-rally-in-u-s-stocks

[7] Stocks Keep Rallying: http://randomroger.blogspot.com/2012/02/stocks-keep-rallying.html

[8] Stick To Your Plan: http://www.thediv-net.com/2012/02/stick-to-your-plan.html

[9] S&P 500 (SPX): http://www.wikinvest.com/index/S%26P_500_(SPX)

[10] Airiq Inc: http://www.wikinvest.com/stock/Airiq_Inc_(IQ)

[11] Wikinvest: http://www.wikinvest.com

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