Thursday, August 2, 2007
Updates to $SPX resistance level for rally (Aug. 2, 2007)
The Wednesday, August 1, intraday reversal of $SPX after hitting a low of 1439 combined with very oversold conditions are some reasons why we might get a more sustained rally.
Based on Fibonacci retracements from the recent highs (1555) to the recent low of 1439, the rally might go up to either 38.2% retracement, 50% retracement, or 61.8% retracement which would be 1484, 1497, or 1511 if the rally is really powerful. 1497 seems like a reasonable resistance level in the $SPX.
As I mentioned earlier, I expect a re-test of the $SPX lows from around 1437-1440.
1. $SPX could bounce off support and form a good double bottom.
2. $SPX could break through support and start new leg down.
This is a partner piece to the previous chart analysis.