tag:blogger.com,1999:blog-12640938.post-38713290280593565722008-05-09T03:55:00.003-04:002008-05-09T04:01:55.496-04:00Serious Selling Occuring in SPYThe SPY continues to struggle at resistance. It hasn't yet broken through the near term uptrend channel mentioned in yesterday's report, but it is probably only a matter of time.
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<a href="http://bp3.blogger.com/_cOdCankolXI/SCQEqvqzt8I/AAAAAAAAAUU/0UUoTVgaegE/s1600-h/spy.gif"><img style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;" src="http://bp3.blogger.com/_cOdCankolXI/SCQEqvqzt8I/AAAAAAAAAUU/0UUoTVgaegE/s320/spy.gif" border="0" alt=""id="BLOGGER_PHOTO_ID_5198285002289428418" /></a>
As you can see in the chart above, the price is struggling against the long term downtrend line, which also converges at broken support from last January. A large number of investors bought into this market above $142. These same investors, including large institutional players, have been waiting for an opportunity to cut their losses, which means that there is a huge supply of sellers in this area.
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The only real question that remains is will we get another minor bounce back to $140-$141 that fails, or will the near term uptrend fail here?
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<a href="http://bp3.blogger.com/_cOdCankolXI/SCQEwvqzt9I/AAAAAAAAAUc/TnbsFeJ3TyI/s1600-h/risk.gif"><img style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;" src="http://bp3.blogger.com/_cOdCankolXI/SCQEwvqzt9I/AAAAAAAAAUc/TnbsFeJ3TyI/s320/risk.gif" border="0" alt=""id="BLOGGER_PHOTO_ID_5198285105368643538" /></a>
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<strong>Outlook:</strong>
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It's unclear whether a price failure in this area will lead to an extended decline that ultimately takes out $126 or if a failure here will merely lead to a minor decline that soon stabilizes (perhaps in the $137 50-day average area). It is fairly clear though that a serious top was reached this week.SRSFinancehttp://www.blogger.com/profile/13898711515456194122noreply@blogger.com