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Although we disagree with the idea that "the tape tells all," it is important for all traders to stay on top of key technical happenings on the charts. Below is our current "executive summary" take on the State of the Tape.
Technical Talk: November 30, 2010
Current Strategy:
So far at least, it appears that data is trumping fear today. Once again stocks opened lower on debt contagion fears as traders play the "who's next?" game in Europe. Once again, the S&P tested the all-important line in the sand this morning. And once again, the bulls have defended their turf (as of this writing). Thus, the game right now is pretty simple: Watch the 1175 zone... If it holds, it remains bulls' ball. But if the bears are able to break on through, we could see much lower prices.
We'd be Short-term Buyers At: A close above 1200 on S&P 500
We'd be Short-term Sellers At: A close below 1174
Trend and Momentum Indicators:
Short-Term Trend: The short-term trend continues to waffle. And while we hate to sound like a broken record, the support zone holds the key to the near-term.
Intermediate-Term Trend: The intermediate-term trend rating remains moderately negative from our model's point of view. But from a subjective perspective, as long as support holds up, we will view the current pullback as part of a consolidation phase.
Market Internals: Our TBC models are both neutral this morning. We will note that our "all cap" equity indexes have held up better than the blue-chip Dow and S&P indices. As such, our TBC models are no worse than neutral.
- TBC = Trend-and-Breadth-Confirm Model
Market Momentum: Ditto from yesterday: Our momentum models remain neutral-to-moderately positive.
Support/Resistance Zones for S&P 500:
- Current Support: 1175ish
- Current Resistance: 1200ish
Early Warning Indicators:
Overbought/Oversold Condition: Stocks continue to be oversold from a short-term perspective but are no better than neutral when looking at the intermediate-term.
Investor Sentiment: Our sentiment indicators aren't doing much at the moment and remain moderately negative on balance.
Chart Watch:
S&P 500 Last 12 Months
S&P 500 Last 5 Years
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