Today being a weekly close it is important for the Bulls that the market remains above the 1218.64 level. A close below this level would suggest that the market will decline for at least two more weeks with a minimum target of 1208/1203. To have a bullish close today it will take a close above the 1230.39 level today which has only a 30 percent probability. Key short-term support for Friday in the SPX: 1215.45 Key short-term resistance for Friday in the SPX: 1221.05
The Bulls are looking good so far, especially on a Summer kind of Friday which notoriously and seasonally have been weak. Bottoming pattern emerging?
The S&P is bouncing off the 50 DMA. While it still appears like we are in a down trend, the shorts/bears need to be careful. It's probably best to wait and see which side wins before placing your bets.
Today's close at 1219.71 in the SPX bodes well for the broader market on a Weekly basis. Will post Weekly chart of SPX over the weekend with momentum indicators. With MRK's decline and the $2 per barrel surge in WTI Crude, I'd say that the market did pretty well for itself, especially on a very lighly traded 1.2 billion share options expiration Summer Friday in which a short-term bearish trend can put pressure on the overall market, triggering stops, etc. Will update over the weekend. Trade of the Day: MRK August 30 Puts . . . from .15 to 2.25
A close above the 1229.95 level this coming Friday will be necessary to signal a bullish pattern. The momentum on the intermediate chart is accelerating even though prices have moved lower over the past three weeks. This suggests that the underlying trend is still expanding indicating that this pattern will resolve itself to the upside. The projections of 1292/1315 remain valid and only a weekly close below the 1199.80 level will negate the pattern.