S&P 500 Index Archives - Page 7 of 12 - the patient investor %

October 15, 2012

US: Not yet out of the woods

The S&P 500 found support at 1430, closing the day with a decent blue candle. Avoidance of a double top and recovery above the lower trend channel indicate another test of 1475, but 21-day Twiggs Money Flow below zero still warns of medium-term selling pressure — a peak below zero would strengthen the signal. Breakout above 1475, however, would signal a primary advance, while reversal below 1430 would warn of a correction.

S&P 500 Index

* Target calculation: 1420 + ( 1420 – 1280 ) = 1560

The Dow Jones Industrial Average (weekly chart) is similarly testing support at 13300. Bearish divergence on 63-day Twiggs Momentum indicates a weakening up-trend, and reversal below zero would warn of a primary down-trend. Recovery above 13650 would confirm the advance, while reversal below 13000 and the primary trendline would signal trend weakness.

Dow Jones Industrial Average

* Target calculation: 13000 + ( 13000 – 12000 ) = 14000

Colin Twiggs

Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters.

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.
He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.

October 10, 2012

US: Double top threatened

The S&P 500 respected resistance at 1475 and is testing support at 1430. The Dow displays a similar formation with support at 13300. Breakout below 1430 would complete a double top, warning of a correction. Reversal of 21-day Twiggs Money Flow below zero indicates rising selling pressure. Respect of support is unlikely but would suggest an advance to the upper trend channel.

S&P 500 Index

* Target calculation: 1420 + ( 1420 – 1280 ) = 1560

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

October 8, 2012

US: Continued selling pressure

Resistance on the S&P 500 has shifted from 1450 to 1475, Friday’s weak close and declining 21-day Twiggs Money Flow indicate selling pressure. Breakout above 1475 would signal a primary advance, while reversal below 1430 would warn of a correction.

S&P 500 Index

* Target calculation: 1420 + ( 1420 – 1280 ) = 1560

The Nasdaq 100 (weekly chart) is similarly testing support at 2800/2750. Bearish divergence on 63-day Twiggs Momentum indicates a weakening up-trend; reversal below zero would warn of a primary down-trend. Respect of support is would indicate another advance, while failure would strengthen the bear signal.

Nasdaq 100 Index

* Target calculation: 2800 + ( 2800 – 2450 ) = 3150

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

October 2, 2012

US: Buying pressure easing

The September Quarter has ended, bonuses have been determined, and buying pressure is now likely to ease. The S&P 500 is testing resistance after breaking support at 1450. Bearish divergence on 21-day Twiggs Money Flow indicates selling pressure. Respect of 1450 is likely and would indicate a test of 1400.

S&P 500 Index

The Nasdaq 100 weekly chart shows the index testing support at 2800/2750. Bearish divergence on 63-day Twiggs Momentum indicates a weakening up-trend; reversal below zero would warn of a primary down-trend. Failure of support would strengthen the signal. Respect of support is unlikely but would indicate another advance.

Nasdaq 100 Index

* Target calculation: 2800 + ( 2800 – 2450 ) = 3150

Bellwether transport stock Fedex is testing support at $84. Narrow range of last week’s candle indicates selling pressure — as does reversal of 13-week Twiggs Money Flow below zero. Downward breakout would confirm the primary down-trend earlier signaled by 63-day Twiggs Momentum below zero. A Fedex down-trend would warn of slowing activity in the broader economy.

Fedex

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 24, 2012

US: Fedex warns of declining activity

Bellwether transport stock Fedex fell hard in the last week, testing support at $84. Breakout would confirm the primary down-trend signaled by 63-day Twiggs Momentum below zero. A down-trend on Fedex would warn of slowing activity in the broader economy.

Fedex

A daily chart of the S&P 500 index shows narrow consolidation above 1450. Bearish divergence on 21-day Twiggs Money Flow continues to warn of selling pressure. Reversal below 1450 would indicate a test of 1400.

S&P 500 Index

Weekly chart of the Nasdaq 100 shows the index hesitating below 2900. Expect retracement to test the new support level at 2800.

Nasdaq 100 Index

* Target calculation: 2800 + ( 2800 – 2450 ) = 3150

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 18, 2012

S&P 500 hesitates

The S&P 500 hesitated at its upper trend channel. Follow-through below 1460 would indicate a test of the lower channel and support at 1400. Bearish divergence on 21-day Twiggs Money Flow continues to warn of a correction.

S&P 500 Index

* Target calculation: 1420 + ( 1420 – 1280 ) = 1560

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 11, 2012

S&P 500 retraces

The S&P 500 is retracing to test its new support level after breaking resistance at 1420. Respect would signal an advance to 1570*, while failure of support at 1400 would indicate a bull trap. Bearish divergence on 21-day Twiggs Money Flow continues to flag medium-term selling pressure. Breach of the lower trend channel — and support at 1400 — would warn of another test of primary support at 1300.

S&P 500 Index

* Target calculation: 1420 + ( 1420 – 1270 ) = 1570

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 7, 2012

S&P 500 breakout

The S&P 500 and NASDAQ 100 broke through resistance to signal a primary advance. Dow Industrial Average has yet to confirm. Timing of the breakout is significant, with November elections looming and the Fed doing its best to prime the pump. September/October is a tentative time of the year, with risk of a “Spring sell-off” following the quarter end, as in 2007. Traders may ride the “election rally” but investors need be more cautious. The market is being driven by macro-economic signals (quantitative easing) rather than earnings.

All is not well: Europe is in recession, China headed for a sharp contraction, and some tough choices will have to be made in the US after the election euphoria is over. Balance sheet expansion (QE) by the Fed, ECB and PBOC is likely but inflation will be muted by private sector deleveraging. And QE will be scaled back as soon as credit contraction eases.

The S&P 500 broke through resistance at 1420 to signal an advance to 1570*. A 63-day Twiggs Momentum trough above zero reflects the primary up-trend. Retracement that respects support at 1400 would confirm the signal.

S&P 500 Index

* Target calculation: 1420 + ( 1420 – 1270 ) = 1570

Dow Jones Industrial Average is testing resistance at 13300. Breakout would strengthen the S&P 500 signal. Rising 13-week Twiggs Money Flow indicates buying pressure.

Dow Jones Industrial Average

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 3, 2012

Lackluster S&P 500 and Dow Industrials

The S&P 500 Index is currently consolidating between 1400 and 1420. Lackluster momentum suggests another correction; confirmed if Twiggs Momentum (63-day) reverses below zero. Breakout above 1420, however, would signal an advance to the 2007 high of 1560*.

S&P 500 Index

* Target calculation: 1420 + ( 1420 – 1280 ) = 1560

The Dow Jones Industrial Average is similarly testing support at 13000 on the weekly chart. Downward breakout would penetrate the rising trendline, suggesting another correction. Weak volume signals a lack of interest from buyers rather than resistance from sellers. Upward breakout above 13300 is unlikely, but would indicate an advance to the 2007 high of 14200.

Dow Jones Industrial Average

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

August 27, 2012

S&P 500 and Nasdaq bearish divergence

The S&P 500 Index continues to test resistance at 1420. Bearish divergence on 21-day Twiggs Money Flow warns of medium-term selling pressure. Expect a test of the lower trend channel; reversal below 1380 would indicate a correction. Breakout above 1420, however, would signal an advance to the 2007 high at 1560*.

S&P 500 Index

* Target calculation: 1420 + ( 1420 – 1280 ) = 1560

The Nasdaq 100 is similarly testing resistance at 2800 on the weekly chart. Breakout would offer a target of 3150*. The 63-day Twiggs Momentum trough above zero indicates continuation of the primary up-trend, but reversal below zero would warn of a primary down-trend.

Nasdaq 100 Index

* Target calculation: 2800 + ( 2800 – 2450 ) = 3150

Fedex is testing support at $88, neckline of the March/April double top. Failure of support would suggest continuation of the primary down-trend; confirmed if support at $84 is broken.

Fedex

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.