S&P 500 Technical Analysis: Weekly Update
Written by Taurus on November 2, 2009
Hello guys, what a week it has been! It was a pretty bearish week, with the S&P 500 breaking a few supports along the way. Is it time to sell yet? Let’s take a closer look!
ETF Market Trends: S&P 500
The S&P 500 has been whipping around the 50-MA for the last couple of days. This 50-MA has been a strong support for a long time, but finally the S&P 500 closed below it for the week.
Attached below the chart is the MACD indicator. There are two important warning signals that we can observe from this indicator. The first warning signal is there is a bearish divergence (Shown in green), which might signify that the S&P500 might be on its way down.
The second warning is that the MACD line (Red) is about to cross below the zero-line. Although its still above the zero-line for now, further trending to the downside will enable the MACD line to head below the zero-line, which would further signify the trend is bearish.
The index has however, managed to rest on an uptrend support line (Black). This was also a resistance back in August 2009. There is also another support level around the 1,020 level. If the index does not break the resistance level of 1,100, a Head and Shoulders formation might be in the works. Good luck!
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