New York, Nov.8, swing trading .- The S&P 500 broke support at 1400, warning that a top is forming. A 21-day Twiggs Money Flow peak below zero would indicate medium-term selling pressure. The “honeymoon” period leading up to the election is over. It is back to “business as usual” as the President and the Republican-controlled Congress arm-wrestle over taxes, entitlements and the budget deficit. Speaker of the House John Boehner extended an olive-branch of sorts, saying that Republicans were willing to accept additional tax revenues, but his emphasis remains on reforming entitlement programs and curbing “special interest loopholes and deductions”.
The Dow Jones Industrial Average similarly broke support at 13000 on the weekly chart. Breach of support and the primary trendline warn that a top is forming. Reversal of 63-day Twiggs Momentum below zero would suggest a primary down-trend. Recovery above 13300 is unlikely at present but would indicate another advance.
* Target calculation: 13000 + ( 13000 – 12000 ) = 14000
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