The S&P 500 Financial sector is trading down about 1.7% today after a 2% decline yesterday. If this decline holds, it will be the first back to back 1%+ decline for the sector since July 7th - July 8th. With today's negative open, the sector broke its short-term uptrend line which had been in place since the September 2nd low. The sector is currently trading at around 198.5, which is right at its uptrend line from the July lows. If the sector breaks below 198, the next level to watch is roughly 190. This represents the 50-day moving average, and more importantly, the uptrend from the March lows. If that level doesn't hold, the 200-DMA doesn't come into play until around 153.
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What is the point of drawing a line connecting 2 lows? If you have 4,5,6 lows all in a line, fine, but 2? Connecting 2 points doesn't tell me anything. It has the same forecasting ability as my lottery ticket. Unless you can give us proof or a study about the forecasting abilities of connecting 2 lows?
Posted by: ComeOn | September 24, 2009 at 02:18 PM