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Tuesday, January 16, 2007

S&P500 Daily Analysis for Jan 16th



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  • 1st time frame up trend intact.
  • Japanese candlestick Spinning Top pattern - denotes indecision - raises doubt about ability of up swing to develop further.
  • The market closed with neither the bulls nor bears in control. While the bulls were slightly keener, both sides lacked any commitment.
  • The resistance area, marked in orange, has been tested on at least six previous occasions. This level will be very important to the market tom0rrow. If it holds we will see the market trade back down to the support level marked in dark yellow. If it breaks out to the up side, there is not a lot of potential for great development because ST volatility is at a fairly high level and the tendency will be for ST volatility to come off, which results in either a pullback or consolidation.
  • Triple MAs are BULLISH.
  • MACD histogram remains ST bullish.
  • ST volatility is likely to find resistance fairly soon. We would expect to see a cyclical peak in ST volatility. That would limit the extension of the current up swing if the market breaks out to the up side in the next few days.
  • Volume continues to come off as the market makes swing highs - fails to support the up swing.

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posted by Equities Analyst at 6:23 PM

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