SP500 Daily Swing Goes Green

Mar 12, 2009: 1:59 PM CST

As I mentioned in last night’s post “S&P 500 Color Bars,” the S&P needed a little more ‘push’ to switch the color rule green, and that signal has triggered just now.  Let’s take a mid-day look at the S&P 500 Index to see key overhead resistance points and see the “Green” Rule triggering on today’s action.

We got enough of a push off the 666 price lows from Friday to trigger the color rule function to switch to a green bar, meaning price has moved a sufficient multiple of the Daily Average True Range to trigger a signal.

Price formed a doji on Friday and then formed a semi-doji on Monday before price surged on Tuesday which led to the current official retracement swing we are seeing now.

There are two levels of overhead resistance that *might* produce problems for eager buyers, though if they are both overcome, it would show immense strength.

We’re sitting right now at confluence overhead resistance from the November price lows and the falling 20 day EMA (green).  It looks like we could overcome this level but it may be a big battle at the 750 price level.

Next, we have major overhead resistance at 800, which would be the January lows (and support level), “round number” support, the 50 day EMA, and unseen on this chart, the 50.0% retracement off the January highs and then the confluence 38.2% Fibonacci retracement off the November 2008 price high.  Watch the 800 level very closely if we get there.

There’s open-space to 800 if we break above 750, but the sellers might just step it up at these levels.

Corey Rosenbloom
Afraid to Trade.com

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6 Comments

6 Responses to “SP500 Daily Swing Goes Green”

  1. sm Says:

    Hi Corey, thanks for the very useful and objective commentary. Which software are you using to draw these color charts as illustrated in this post ?
    thanks

  2. Corey Rosenbloom Says:

    SM,

    My good ole’ trusty TradeStation.

  3. sm Says:

    thanks 🙂 i reread your post from yesterday and persume that you must have bought or have access to the LBR group’s signal plugin. i discovered your blog about a couple of weeks ago and i can’t tell you enough how much i look fwd to your charts and thoughts, they greatly help. appreciate it :).
    cheers,
    Satbir

  4. Corey Rosenbloom Says:

    Satbir,

    Glad to have you as a reader! You help keep me motivated to keep posting and sharing.

  5. van Says:

    I’m trying to figure out what criteria constitutes the difference in a green bar verses a yellow bar

  6. Corey Rosenbloom Says:

    I actually can’t share that publicly as I didn’t create the algorithm and was purchased for a fee.

    It’s a range (volatility) function off swing lows and highs as a multiple of the Average True Range.