The behavior of the stock market last week has generated much uncertainty among investors. The market is about to bounce?... or sterting along way down?. As always, the answer is the same: nobody knows. However, we have a number of tools allows us to analyze the various options facing the market.
If we look al the chart of S&P-500, we see three important aspects: first, culd not bear the breakout reached tuesday. Second on friday crossed the line of medium-term trend. And third, the market fell below SMA20, SMA50 and SMA100 days, which are three important levels of support.
From my point of view, it is likely that the new support and resistance bandis located within the levels of SMA 200 days (1250 points at present) and the trendline (currently at 1312 points). In these cases, if the S&P-500 is maintained in the coming weekes within these levels, it seems, inevitable to fall to the SMA 200 days and do a test at that level.
Click here to see the chart of S&P-500
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