Yesterday gave us a little bit of a fakeout, as the failure to close above 1105 might have caused some bears to jump the gun, but spending most of the day above it showed it was vulnerable. Today it fell pretty easily, and it appears the next level of resistance is around 1110. Today, I put up a chart without resistance and support lines so the moving averages could clearly be seen. It does appear that both simple and exponential 200dmas are coming into play, as the two have diverged farther apart than at any time in the last 6 months. It does appear that those two averages are going to be the key levels in the next week or so, and we are ight in the middle.
I introduced the Elder Impulse System on the daily charts a couple of days ago, and today I thought I would take a look at the weekly. Since the Elder sysem is designed more for short term trades, it's probably not as reliable on a weekly chart (although stockcharts.com does use a weekly chart in their examples). One thing I notice s that the blue bars are not as reliable here in indicating a trend change. However, the first weekly green bar has been a decent buy signal, and we are now on thee second green week. Stochastics are also indicating strong upward momentum, and MACD is showing signs of reversing.
The Russell 2000 was the closest to breaking down through the lower level of it's range, but it didn't, and has been the leader on the bounce back up. It is, however, still in a precarious position, has weak stochastics, and is going to have to contend with a 40 week line tha is very close to turning downwards.
Ever since the big rally of July of 2009, we entered into what has become a large trading range, which, despite the breakout earlier this year (and subsequent collapse back) has resulted in a basically flat market for about a year.
I will have the new highs update shortly.