US indexes retreats
The S&P 500 retreats again to it’s lowest level to 1,292.3 since August 2006. This was mainly driven by an all time high in US mortgage foreclosures and the biggest drop in jobs data in five years added to signs of economic weakness.
Here’s what the technical analysis on the S&P looked like last Friday:
On this chart it shows that the S&P have just broken the support line and have just finished the day under at the new “resistance”line at 1,309.5. It will be interesting to see if theS&P will test this previous support line and test last January’s low at 1,253.8.
Have a look at last Friday’s chart for the Nasdaq:
This shows a 10 year chart overview of the Nasdaq 100. It shows the previous top of 2002 and 2006 resistance levels and on a closer look (below), it shows that it is on the current levels and hovering around the support line of 1,706.
The Nasdaq is also hovering on the bear flag formation of 1,706 support level. This chart also shows a “double top” around the December 2007 and early January 2008 level.
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**For the new readers, a double top is a major reversal pattern that forms after an extended uptrend. As the name implies it consists of two consecutive highs that is almost equal and some troughs in between.
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Should this break lower at this level - it will next retest the support line at 1,449.6
The next few weeks will be interesting times indeed.
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