September 20, 2010

S&P 500 and the 200 DMA

  • S&P 500 Daily chart with 200 DMA acting as resistance. If you notice the 200 DMA it is moving like a horizontal line which acts as support and resistance in chart.
  • I have marked an area from June till now were 200 DMA acted as resistance. Now the index is pulling away from the 200 DMA (confirmation needed on closing basis). If it pulls away to levels like 1170 or 1180, any dip from those level to the 200 DMA will give a chance to enter long trades again.
  • Above scenario possible only if the index closes higher today and should make Higher high's and Higher low's in the coming day's.

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