Technical talk: Not convinced that corner has been turned

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

As seen below the S&P 500 Index finally bounced near support (1,172), which was a convergence of support and the rising 50-day moving average (red lines). Internals were not as impressive as the point gain, thus we are not convinced that this corrective wave is over yet. We clearly need to see follow-through on better internals to be convinced the corner has been turned. Any move below support in the 1,172 area would open risk for a move down to 1,150.

As seen in the 31-day chart below the S&P 500 got back above its minor downtrend line near 1,195 (red line), which is a start. However, until the S&P 500 can get back above resistance in the 1,205 to 1,208 area (green line) we remain a bit cautious about engaging the bounce.

Source: Kevin Lane, Fusion IQ, November 19, 2010.

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