welcome back to the Stockchartsrus Blog.
Today we will look once again at the S&P 500 depository receipts (SPY). The potential bottom we talked about last blog has yet to be confirmed. Additionally, a move below the low of $126 (from 01/22/08) will signal yet another sell signal and suggest prices may need to move toward the $120 area. The Cliche, 'Its always darkest before the dawn' seems appropriate. Keep in mind, the US market (as measured by this broad basket of stocks) is now down more than 12% YTD so traders will be looking for any type of rally to save their February. As well, the market is flirting with the 4 year average price at or near $126. In other words, the market isn't over-valued any more.
In a sentence: While there is no buy, the market is cleaning itself up.
Until next blog,
Brian Beamish FMA FCSI
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