S&P: Important levels being tested

The S&P 500 is in a fog and observing price behaviour on the charts is the best way to see through it, says Ron Meisels, President of independent research house Phases & Cycles,

On the negative side of the argument, Meisels points out that the daily NYSE advance/decline line is trending down and the number of NYSE stocks marking new 52-week lows is growing. Against these negatives, Meisels says the S&P 500 continues within its trading range and its 50-day and 200-day Moving Averages continue to act positively, and the broader indices such as the NASDAQ Composite Index and the Russell 2000 remain strong.

To see through the ‘market fog’, Meisels returns to the price charts and concludes that the major market indices continue to hold up well, even though some of the S&P 500’s near-term support levels are being tested. He says we can now see the price levels that the S&P needs to overcome to trend higher (2,140) or the level that, if broken, would indicate only an intermediate-term decline (2,039).

See chart of S&P 500.

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