Tuesday, March 1, 2011

SPX and Transports: Mixed Signals

The recent decline has left a murky picture with regard to the future short term direction: i.e. signs of possible weakness.
  • The Transports made a recovery high with the S&P but during the recent decline the Transports have been somewhat weaker than the S&P 500
  • The S&P formed a swing low at the Feb 24th low @ 1294.26
  • The Transports formed a swing low at 4988.67 on January 28th but briefly traded below that level on Feb 23rd at 4917.70 but rallied to close the day at 4986.21
  • The 4986 level becomes an important pivot to monitor for the Dow Transports.
  • A break of the recent swing low of 1294.26 on the S&P would suggest a further decline.

The present period Feb 28 -- March 4th represents a relatively powerful energy window.

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