Quick Update on the SP500 Trend Channel April 27
Apr 27, 2010: 11:20 AM CSTFor the third time in the last few days, we’ve broken slightly under the rising dominant trend channel as seen best on the 60-min chart of the S&P 500.
So far, that channel has held, but today, we’ve broken slightly under the channel so let’s take a hyper-focus on these price levels and what to watch:
(click for full-size image)
For reference, this trendline channel takes into account the price swings and highs from March and early April and projects into the immediate present.
We’ve had a bull trap in mid-April (false break outside the trend channel) and two mini-bear traps in late April (the two false breakdowns).
Currently, we’re officially beneath the rising trend channel which locates itself just above 1,200.
We’re testing the prior price swing low at 1,190, and just broke slightly beneath it (as of the time of this writing).
The next prior low is 1,183.
For reference, the rising 20 day EMA – which we’re now under – is 1,193.
I’ve written in the past about the importance of the 20 day EMA:
April 23: Revisiting SP500 Trendlines and Adding a Triangle
“S&P 500 Remains Above Trendline Support… for Now” and
“Rising Trendlines… the Only Thing that Matters Now?“
For reference, if we break under 1,183, then the rising 50 day EMA rests at 1,167.
Beneath that, we have the all-important “Line of Demarcation” at 1,150.
All of these are levels to watch as reference as we move forward in time.
Corey Rosenbloom, CMT
Afraid to Trade.com
Follow Corey on Twitter: http://twitter.com/afraidtotrade
