Stock Market Hits Major Resistance, A Time for Caution and Respect

By: Marty_Chenard

It has been a rally with no significant upside resistance for the S&P 500 ... until now.

In 2007, the market started its journey down in a ride where many investors where afraid to jump off of the moving train. Since March of this year, many have left their fear behind as the S&P moved up once again in a rally with Government and Fed rhetoric singing songs of "the recession is over".

That was nice ... but there was very little overhead resistance to stop the rally.

But now, for the first time since March, we are challenging a very formidable resistance level as seen on today's chart.

It is not "just any resistance" ... it is a Major level that was in existence before the market had its big plunge after last September. And now we are testing that resistance. In fact, the S&P 500 tested that resistance last week and pulled back.

The testing is technically still in play because the S&P has recently been making higher/highs and higher/lows. That is the definition of an up trend, so the failure to penetrate the resistance was not official and can't be unless a down trend begins.

Until then, the S&P has the possibility to retest this Major resistance level. Since this is a Major resistance level, it is a place where caution and respect is warranted.

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By Marty Chenard
http://www.stocktiming.com/

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Marty Chenard is the Author and Teacher of two Seminar Courses on "Advanced Technical Analysis Investing", Mr. Chenard has been investing for over 30 years. In 2001 when the NASDAQ dropped 24.5%, his personal investment performance for the year was a gain of 57.428%. He is an Advanced Stock Market Technical Analyst that has developed his own proprietary analytical tools.  As a result, he was out of the market two weeks before the 1987 Crash in the most recent Bear Market he faxed his Members in March 2000 telling them all to SELL.  He is an advanced technical analyst and not an investment advisor, nor a securities broker.

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