The 1100 Level on the SP500 May 27

May 27, 2010: 2:42 PM CST

From one expected price level to the next – that’s how short-term trading works.

Right now, we face the next key level to watch – overhead resistance – at 1,100 and so we play another round of “will it break or will it hold.”

Here’s  a quick update:

The 1,100 level is ’round number’ resistance which also forms a confluence with the rising 200 day simple moving average.

A break above this level puts the balance back in the bullish camp, and makes this brief time under the average a mean whipsaw for the bears.

Of course, as I mentioned earlier, any solid break under 1,040 officially reverses the trend from up to down… definitionally speaking, we are still technically in an uptrend while we’re above 1,040.

A quick look at pre-end of day market internals – Breadth and Volume Difference – show bullish potential:

The 5-min S&P 50 Chart above shows the consolidation range between 1,070 and 1,090 which has developed over the last few days.

Breadth formed a new chart high yesterday in the morning session, which has continued into today’s session – that’s a bullish sign.

VOLD – volume difference of advancers and decliners – also broke out yesterday, but did not form a new chart high.  That distinction was made on the May 21st rally.  Not super-bullish, but a good sign that VOLD is registering positive 1 million shares right now.

So a break above 1,100 sends the upper target to 1,120 at a minimum and then a possible short-term target back to 1,150.

On the other side of the “If/Then” assumption, a failure for bulls to overcome 1,100 would likely send us back down to test 1,050, but from the looks of internals, the bulls have a good shot of breaking above 1,100.

Let’s see if they do.

Corey Rosenbloom, CMT
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3 Responses to “The 1100 Level on the SP500 May 27”

  1. Deb Ghosh Says:

    Nice post Corey..S&P closed just below MA 200 but we are above 1100. But SPY, Nasdaq both closed above MA 200 except S&P and Dow. Edge is in favor of bull after today's run up..But lot of things might change overnight..Lets see

  2. theyenguy Says:

    The 1,100 level provides very strong resistance as it is the middle of a “broadening top pattern” that goes back to late January.

    A lot depends on the strength and follow through of the Euro and overnight trading in stock market trading in Asia

    It really was an awesome day for the Bulls as the bounce up in the Euro blasted oil, base metals, and European stocks higher; for a full report; click on the link below

  3. hack de social wars Says:

    hack de social wars…

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