S&P 500 Index

[BigSully1]

Friday's Market Wrap video from IBD; I hope the link works.

http://www.investors.com/MediaCenter/?MediaID=753&t=V

[la-onda]

chart quotation daily and weekly
will the August low tested and holding ?

[Ramsburg]

Here some quick technical notes for the SPX:

- From October to March, a solid bear trend was in place, with several down-swings of bigger intensity and heavy volume for the extended selling zones. The last down-swing, ended in March, creating a false downside breakout.

-  After the false breakout (March), the index is developing a steady up-swing (still in play), that ended the previous pattern with an upside breakout and new relative higher highs. During the process an Inverted H&S was designed and triggered (a pattern that is still in play). This kind of price action (after a false breakout), suggests a big Baskerville signal in place (compatible with the Inverted H&S target near 1500).

- Moving average analysis: the EMA-50 is still below the EMA-200, still marking the presence of the down trend, but the EMA-50 has already a positive leaning while the EMA-200 is flat. These are lagging indicators, but its current layout suggest an upside inversion taking place for the mid-term (not yet confirmed).

-Short term analysis: the index reversed today at 1440, creating a new resistance level for short term. Momentum analysis may suggest a consolidation to take place before a new advance, but the up swing is still intact at this point. On the downside, I would point 1406 (aprox the EMA-200) and 1388 which has been a reaction zone, both values to take in consideration in a probable consolidation scenario.

My overall sentiment for the SPX is bullish right now despite from a possible short term consolidation or selling action.

In attach 2 annotated charts.

Best regards,

[setravis]

S&P below 700 as banks' future still in question
Tuesday March 3, 2009, 4:57 pm EST


NEW YORK (Reuters) - Stocks fell in volatile trading on Tuesday, with the S&P ending below 700 for the first time since October 1996 as persistent uncertainty about the amount of money needed to shore up the financial system overshadowed a hunt for bargains.

Stocks swung to both sides of the break-even mark throughout the session with the S&P's ultimate break below the key psychological level of 700 adding to the gloom.

Federal Reserve Chairman Ben Bernanke left the door open to whether banks will need more money when he said the size of a $700 billion bank-rescue package would depend on bank "stress tests" being conducted by regulators and the economy's direction.

An S&P index of bank stocks (^GSPF - News) fell 1.6 percent, with Goldman Sachs (NYSE:GS - News) off 4.5 percent at $82.37 and PNC Financial Services (NYSE:PNC - News) down 5 percent at $24.82.

"His comments were a reality check for the market that nothing changed between yesterday and today," said Jim Awad, managing director at Zephyr Management in New York.

"It renewed fears that there is no bottom in terms of toxic assets and no bottom in terms of need for capital."

The Dow Jones industrial average (DJI:^DJI - News) fell 37.27 points, or 0.55 percent, to 6,726.02. The Standard & Poor's 500 Index (^SPX - News) lost 4.49 points, or 0.64 percent, to 696.33. The Nasdaq Composite Index (Nasdaq:^IXIC - News) shed 1.84 points, or 0.14 percent, to 1,321.01.

The S&P is down nearly 23 percent for the year so far and has given up more than 55 percent since the high hit in October 2007.

"700 is an amazing number when you think 16 months ago, we were at the high," said Howard Silverblatt, senior index analyst for Standard & Poor's.

"It's psychological and obviously, it reinforces the negative situation, especially where there's not a lot of credibility out there."

OIL SECTOR, AMERICAN EXPRESS GAIN

On the upside, energy shares got a boost from oil's gain of $1.50 to settle at $41.65 a barrel on expectations that OPEC will cut production output again. Chevron (NYSE:CVX - News) cut earlier gains to end up just 0.2 percent at $57.73.

American Express (NYSE:AXP - News) shares rose 6.9 percent to $11.82 after the U.S. government unveiled details of a program to stabilize the financial system that could ease the credit card company's financial expenses.

In its latest efforts to bolster the economy, the Federal Reserve and the Treasury launched a new securities loan program and said a future expansion may include some of the riskier mortgage and debt securities hampering banks.

The $200 billion Term Asset-backed Securities Loan Facility, or TALF, is designed to give frozen securitization markets a jolt by offering financing for investors to encourage them to buy "AAA"-rated asset-backed securities.

In testimony before a congressional committee, Treasury Secretary Timothy Geithner said the Obama administration will work with Congress to determine the size and shape of future efforts to shore up banks and acknowledged the cost of the financial bailout may rise.

General Electric Co (NYSE:GE - News), down 7.8 percent at $7.01, also weighed down the market as investors fretted about the conglomerate's future. Last week, GE announced a deep cut in its dividend.

Trading was active on the New York Stock Exchange, with about 1.90 billion shares changing hands, above last year's estimated daily average of 1.49 billion, while on Nasdaq, about 2.44 billion shares traded, above last year's daily average of 2.28 billion.

Declining stocks outnumbered advancing ones on the NYSE by a ration of about 2 to 1, while on the Nasdaq, about nine stocks fell for every five that rose.

[setravis]

The S&P 500 broke above its highs from last week today, which confirms a continuation of the uptrend that started back on March 9th. Since then, the S&P 500 is up 25.5%. Five sectors have outperformed the overall market since March 9th, while five have underperformed. Financials are up the most at 60.3%, followed by Consumer Discretionary (36.3%), Industrials (34.4%), Materials (32.1%), and Technology (29.8%). All of the outperforming sectors are cyclical in nature. Health Care has rallied the least at just 11.9%. Consumer Staples, Energy, Utilities, and Telecom are the other four sectors that have underperformed the S&P 500 during the rally.

[setravis]

S&P 500...

The S&P 500 consolidates (short term) between 830 and 875. Upward breakout would test 940, while downward breakout would test 700. In the long term, the primary trend is down. Twiggs Money Flow (13-Week) bullish divergence shows a weak reversal signal and breakout above 940 would offer confirmation. But it would be prudent to wait for the next correction to complete a higher trough, followed by a new high.

[setravis]

The charts of interest this week are of the Dow and S&P500 because they are quickly approaching the 200-day moving average. Many active traders will be keeping a close eye on these levels because they have historically been used to determine the direction of the market. A break above the 200-day moving average could trigger a long-term shift in sentiment.

[setravis]

REVERSE HEAD AND SHOULDERS FORMING ?.......

The ascending wedge pattern has broken down as we expected. Considering that the market has rallied nearly 40%, I think it is reasonable to expect more corrective action.

The next development to watch is the possible formation of a reverse head and shoulders. We currently have the left shoulder, head, and neckline. The correction that has started could result in a right shoulder, if the correction does not turn into the next leg of the bear market. The ideal resolution (if you are a bull) would be for the correction to end in the area of 750-800, then for a rally to blast up through the neckline. If that were to happen, the minimum upside target would be equal to the distance between the top of the head and the neckline... about 1200. Interesting to contemplate, but, hey, we are way ahead of ourselves at this point.

Intermediate-term indicators are still very overbought. This evidence supports the idea that the correction is not over yet.

Bottom Line: The short-term indicators, although oversold, have shifted from a persistently positive range to a more normal range. I interpret this to mean that the invincible nature of the rising trend has come to an end. Coupled with the fact that medium-term indicators are still quite overbought, my conclusion is that there are probably a few more weeks of correction ahead of us. The appearance of some elements of a reverse head and shoulders offer some hope that a major bottom could be forming, but it is too early to turn up the optimism in that regard.

[setravis]

S&P 500

The S&P 500 retreated from strong resistance at 940 and is similarly consolidating in a narrow range on low volume. Reversal above 900 would signal another test of 940, while breakout below 880 would test 830. In the longer term, the bear rally is expected to fail. Twiggs Money Flow (21-Day) reversal below zero would warn of a correction to test primary support at 675. Penetration of resistance at 940, however, would give a weak (primary) up-trend signal. But readers should beware of a bull trap.

[setravis]

S&P 500
The S&P 500 bearish divergence on Twiggs Money Flow (21-Day) would be strengthened if the indicator retreats to zero. Breakout above 950 is unlikely, while reversal below 900 would test primary support at 670.

[setravis]

S&P 500
The S&P 500 is similarly headed for a test of support at 880. Breakout would test primary support at 670. Reversal above 950 is now unlikely, but would signal a primary up-trend with a target of 1100. Bearish divergence on Twiggs Money Flow (21-Day) warns of selling pressure, but the longer-term (13-Week) indicator is more evenly balanced: a fall below 0.1 would confirm the down-swing, while a rise above 0.3 would indicate a primary advance.

[setravis]

S&P 500...
S&P 500 breakout below support at 880 would confirm the Dow signal — and warn of a test of primary support at 670.

The breakout is expected to have a bearish influence on most major stockmarkets.

[setravis]

S&P 500
S&P 500 breakout above 950 would confirm a Dow primary advance, while a fall below 870 would signal the opposite. The strong rise on Twiggs Money Flow (21-Day) indicates that upward breakout is more likely. In the long term, breakout above 950 would signal a primary up-trend with a target of 1100, while reversal below 870 would target primary support at 670.

[setravis]

The FTSE 100 and DAX normally move in sync with the S&P 500 — so their absence of buying pressure has a bearish, albeit secondary, influence on US markets.

[setravis]

S&P 500
The S&P 500 broke through resistance at 950 to signal a primary advance. Penetration of 1000 would offer a target of 1300*.

* Target calculation: 1000 + ( 1000 - 700 ) = 1300