The monthly chart of the S&P 500 shows 63-day Twiggs Momentum has been falling for about two years but is now threatening to form a trough above zero which would signal resumption of the primary up-trend. Breakout above 1420 would confirm, offering a target of the 2007 high at 1550*. Respect of resistance, however, would mean more of the same gloomy outlook — our steady diet over the past few months.
* Target calculation: 1400 + ( 1400 – 1250 ) = 1550
Respect of 2400 on the Nasdaq 100 monthly chart is also a bullish sign. Breakout above 2800 would offer a target of 3200*.
* Target calculation: 2800 + ( 2800 – 2400 ) = 3200