SPX 20 Year: Double Top Revisited

A few months ago I posted a 20 year chart to give us a longer term perspective on what possible resist might come into play.

Here is an updated view.

Draw your own conclusions, but be aware of these levels.

SPX 20 Year / Monthly Chart:

DOW Doji

After breaking out of the wedge, the DOW tested the 12750 resistance area today. Today's price action created a doji candle on the daily chart signifying a weakening in momentum. If tomorrow's close is below the low of today's candle it would hint to a reversal to the downside.

DOW Daily Chart:

NDX Levels

NDX Daily Chart:

The NDX Sector Drivers

The SemiConductors, Software, Biotech and Internet Sectors are the 4 groups that have the most driving force behind the Nasdaq 100. Below are some charts to view that can give us some hints as to why the NDX fell apart and will also give us some ideas on when the bleeding may stop (the sector support areas... if they hold)

It was the Nasdaq that lead last years rally. Time will tell if it can get some juice to do it again.

Internet Index:



Software Index:




Biotech Index:



Semiconductors:

SPX Levels

The SPX continues to consolidate under the 30MA and attempts to cross and hold above the 1370 area have failed.

Consolidation will likely continue until the SPX can break out above 1390 or below 1310.

SPX Daily Chart:

RUT Levels

The RUT had a spastic gap up and rally for the first 15 minutes of trading today, but spent the last 6 hours selling off to close at yesterdays lows.

The RUT continues to find refuge in the 700 area and keeps getting pushed down with every attempt retest resent highs. The intermediate downtrend is intact. There will certainly be more attempts to rise, but be aware that there will likely be more selling into those rallies.

RUT Daily Chart:

DOW Levels

The DOW closed near the bottom of the wedge-like pattern today on the daily chart and actually pierced slightly below the line. Is that small break trying to give us a hint as to the next move?

Tomorrows trading range will give us the next clue.

DOW Daily Chart:

DOW: Short Lived Strength

The DOW started the morning with a nice gap up that held for almost 2 hours before weakening and falling off in the afternoon to form a bit of a topping tail candle on the daily chart.

The daily chart shows an attempt to break out of the consolidation, and today's close did manage to close above the highs of the last 3 days. We'll see if tomorrow it can add to those gains.

DOW Daily Chart:

NDX Levels

The NDX gapped up with the rest of the market this morning, but fell after testing the R2 pivot resistance at 1813. It fell the rest of the day down below the S1 Pivot, got a little bounce and closed down $12.55 to 1780.54.

Notice that the NDX has still NOT closed above the downward trendline on the daily chart and is well below the 30MA.

Weakness in AAPL, RIMM, GOOG, AMZN and the $SOX (Semiconductor Index) continue to hold the Nasdaq 100 down.

NDX Daily Chart:

RUT Daily Chart

The RUT showed a lot of strength in early morning trading, but after hitting the S2 pivot three times throughout the day it finally failed and fell in late afternoon trading. It still managed to close up $5.73 to 705.48.

On the daily chart we can see evidence of consolidation and chop between 690 and 730. While the RUT remains in that range we can expect continued volatility.

RUT Daily Chart:

SPX Levels

The SPX closed up today after bouncing off the S1 Pivot earlier in the session.

So far the price consolidation over the last 5 days shows we're holding this area. We'll just have to wait and see if we move up from here over the next few days.

SPX Daily Chart:

NDX: Lowest Close since Mar 07

The NDX continued it's aggressive move lower today to close at 11 months lows at 1740.95. With disappointing Cisco guidance this afternoon it seems very possible to gap down lower tomorrow morning and test the 1700 intraday lows of a few weeks ago.

The trend continues to be down.

NDX Daily Chart:

RUT Levels

The RUT has spent the last 3 days moving down after getting rejected at the 730 resistance level. I was surprised to see that it didn't have the strength to make it up to 740 before resisting, but that's what makes this business so fun.

The RUT broke the short term uptrend it had going so I'm putting on my bearish RUT hat until I can see some price action evidence to show me otherwise.

RUT Daily Chart:

SOX: Lowest Close in 3 1/2 Years

I am a believer that as goes the SOX so does the NDX. The Semiconductor Index ($SOX) closed at a 3 1/2 year low today. Add to that another likely down day tomorrow after disappointing Cisco guidance and we could have the NDX retesting the 1700 lows or even breaking down below. The NDX broke it's 5yr weekly uptrend and trend breaks that have held this long generally have a high probability of moving down further over time.

Another NDX lifter turned poison is GOOG which is trying to hang out in the 500 area after getting the smack-down from 700. Take a look at the price action that took place after the confirmed trend breaks. GOOG, $SOX, and even AAPL are great examples of what we should do once we see trend breaks. Here are the charts to illustrate.

GOOG Daily Chart:



Apple Daily Chart:



$SOX Daily Chart:

SPX Levels

The SPX continues to consolidate sideways, the price chart says it all. Be prepared for the possibility of some more stress selling to test or create some new lows, but otherwise keep your eyes on the zone between 1270 and 1400 as an area we're likely to chop around in for awhile.


SPX Daily Chart: