SPX update

SPX has reached the target area of  1370-80 which is also a strong resistance in the trading channel. The small reversal ( not really significant) confirms that a temp top is at hand and the bulls will struggle from here to drive prices higher for a few days. We have entered month 9 and likely 13 as the Bloomberg counts are not reliable which does not change the overall picture. One might argue that an inverse H&S pattern is at hand and we  broke above the neckline producing a target of 1430 but I doubt we can reach that within the 2-3 weeks left. SPX has made a weekly 10 count last week with the DOW running ahead at 12, which gives us at least 2 higher weekly closes max 3. A pullback to 1330 is possible and likely but we should be looking for another rise to 1380. The fine tuning will depend on the counting speed as a weekly 11 this week would diminish any probability for higher prices beyond the 1380 area.

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~ by behindthematrix on May 2, 2011.

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