Thursday, March 10, 2011

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S & P 500 still on a roller coaster. Sudden drop below 1300 points. The FTSE

(click to enlarge)
remains fairly high rate of nervousness about the U.S. stock markets, so that in the last two weeks we could talk instead of neurosis. The intraday excursions are pretty violent and have frequent changes of direction and the other between sessions. Today the S & P 500 drops back below 1300 points. We pay much attention as indicated in the recent analysis, the possible closure as below this level would be very dangerous for the U.S. equity. The equalization of 55 sessions runs right around 1300 (exactly 1296), and had indicated as a likely trigger for the start of a new bear market. We note that the index is leaving, with the movement today, the medium-term bullish channel in place since last summer, and also the evolving parabolic medium term. The confirmation below an altitude of 1300 could also trigger a sell-off with quick goals and 1260 points to 1275, and subsequent accelerations up to 1230. At this point only the keeping of 1300 points could still leave some hope for a rebound until 1320, but the positive signal would reach only above 1332, the level which has repeatedly rejected attempts to rise last week.

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