Longer term: The S&P continues its push upward, and has posted an over
night high of 1139.75, and is setting up this week for a test of the highs, and
whether or not we break through those levels and continue the upward climb, or
we confirm the previous high, possibly post a new one, but then fail back below
and use this area to consolidate or possibly even sell back off initially.
Technically there is some reasons why we may not just blow through and reach
for further retracement of the financial crisis, but we have to be careful not to be
fading what has been and continues to be a strong “bullish” trend for the last
year now. The first level to consider is 1141.75, that is the longer term
“buystalk” high, which means, until my longer term chart goes into “buystalk”
mode, that level should act as a heavy level. That implies that we can trade
through there, but the odds are it will then trade back below that level and will
continue to struggle to hold above until we buystalk. The second concern is the
1148.00 print, which is the high of the move, however it was set in the over
night session, not during cash hours, and does need to be confirmed one way
or the other. Sometimes confirmation like that can end up failing once
achieved. Now I would not think normally looking at this 51% retracement thus
far, that the S&P has any reason to stop here, but the fact that we have come
up these last 100 handles, off the 1040.75 retracement low, on a fairly straight
up “reach”, I do think these two concerns may be relevant
Today: We have a high of 1139.75, which looks like it will stand until the cash
open. Europe had opened strong, and has then traded back downward, so
further carry looks as though it is now going to have to come from our side.
The resistance now this morning is at 1138.75, and support will begin at
1135.25. This support has “buoy” qualities, so if it is penetrated, the index will
want to resurface back above there at some point. The next key “buoy” support
then begins at 1131.75. All out failure levels are 1123.50 and 1118.00
respectively, but I am not expecting that type of sell-off action.

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