• Standard Poor 500 Market Analysis for 12-11-12

Pre-market update (updated 8:00am eastern):

  • Europe is trading 0.4% higher.
  • Asian markets traded 0.2% higher.
  • US futures are slightly higher.

Economic reports due out (all times are eastern): FOMC Meeting Begins, NFIB Small Business Optimism Index (7:30am), ICSC-Goldman Store Sales (7:45am), International Trade (8:30am), Redbook (8:55am), Wholesale Trade (10am),  

Technical Outlook (SPX):

  • SPX advanced for the fourth straight day. 
  • The index did a good job of holding the 50-day moving average which previously acted as a strong layer of resistance previously. 
  • There’s actually an inverse head and shoulders pattern forming on SPX daily chart that is close to confirming at 1422. 
  • Volume has been trickling lower over the past four trading sessions, which coincides with the four-day rally. 
  • We are close to being back in overbought territory in the short-term, but that isn’t an overly concerning development at this point. 
  • We’ve also made new highs for the second straight session off of the November lows. 
  • Gap ups in the market of late have been difficult to hold, and often times lead to moves lower overall. 
  • Price action showing a downtrend off of the October highs was broken yesterday on SPX. 
  • Current uptrend off of the November lows is steep, but not atypical for new rallies. Overtime the up-ward trend-line will flatten out some. 
  • 8-day EMA continues to provide rising support for the markets in the short-term. 
  • Ideally for the bulls, if price action can close at or above 1429, the downtrend off of the September highs would be officially done and over with, as a new higher high would be established for the first time. 
  • Fiscal Cliff discussions continues to dominate the news. 
  • SPX currently has recaptured the 10, 20, and 200-day moving averages. 
  • VIX closed at 16.

My Opinions & Trades:

Chart for SPX:

Standard Poor 500 Market Analysis for 12-11-12

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