SP500 has two good rallies in a row, both of them closed at the high of the day, these are good signals that buyers are in control. SP500 is encountering resistance at 4500 level, this would be a good test for the buyers to show their strength. Another point is see close were the last 3 down bars closing, will all the volume, SP500 shredded only 25 points, which tells it going under absorption.
Three scenarios can happen.
- If we fail to penetrate the resistance level and price falling with good spreads and with good volume (can happen with low volume also, it means buyers stepped out) then there is high chance of SP500 falling again and retest 4300, need to watch on this.
- If price penetrates the resistance with good spread (that means buyers are aggressive) and good volume and 4225 is bottom, we may not retest it again.
- If Price hits resistance and falls moderately with low volume may touch 4440 to 4420 levels, then its considered as bullish as sellers are not aggressive and price has to rally from here.
Earnings are helping either side of the case. Apple earnings really turned around the sentiment and boosted the morale. Apple rallied from bottom of this rally and accrued 12.3% vs SP500 rallied 6.8%. If the stock market is going down, Apple would not rise up this much, another way to look up. Apple is the leader and its leading the stocks right now.
No comments:
Post a Comment