The S&P 500 Index Still Aimed For A Test Of Key Resistance At 1,165
Posted in The S&P 500 Index (SPX) on October 25th, 2009 by admin – Be the first to commentBy Jim Donnelly, Olson Global Markets
Despite a number of equity forecasters worried about an end to the impressive stock market rally that emerged from this year’s March low, the S&P 500 Index (SPX) remains “on track†for a test of the 1,165 area when looking at long-term monthly charts.
No doubt, the up move registered by the S&P 500 to date (as well as other indices) has been largely a “one way†event. With that said, however, there has yet to be any defined technical signal to suggest the rally is over.
Perhaps there is a psychological concern that the S&P 500 has been unable to breach the 1,100 barrier. Nevertheless, that level sits just 7 points above from Friday’s weekly close. Many investors will, of course, be gearing up for this coming Friday’s report on October’s employment data. Any hint of a bullish slant to Friday’s report prior to its release, such as the ADP report due out at 8:15 AM on Wednesday November 4th, could be enough to cause a break and or close above the 1,100 level.
Technically, long term stochastic oscillators remain positioned bullishly with plenty of room to move higher. Long-term RSI (relative strength indicator) and MACD (moving average convergence/divergence) also favor a continuation to the bullish trend.
A test of the 1,165 area, if it occurs however, should prove to be an interesting barometer of the health of current equity market recovery.