S&P 500 future did exactly what we expected it to do during last week. It was weaker, but moving aside and trying to break the 1370 resistance on Monday, Tuesday and Thursday without success. Its weekly range was 1327.50 - 1369.70 that compared to our levels provided last Monday (click here) it makes our analysis almost 100% reliable. Two important technical points for the coming week. The resistance at 1370 has shown to be a strong barrier and a potential break of it will push the S&P500 towards 1400 again. This is a likely scenario because on Friday just minutes before closure the S&P 500 gained more than 15 points closing above the blue line. On the other side, if we look at the RSI, it is clear that the green line is acting as a good resistance in area 50. It can be interpreted as a sign of uncertainty and lateral movement. A further movement below the blue trend line will be interpreted as a short, otherwise it will try to move higher again.

 

It seems that NYMEX Natural Gas is showing great strength to run towards the resistance we gave on our last analysis (9.080). Today it hit its high at 9.120 touching again the upper trend line. This is the highest trade since February 2006. We reckon that this market will be weaker as the March delivery will move closer to its expiry. RSI is high and a technical downside correction is more likely, so we speculate on a short position.

 

 

 

 

 

January has been a tough month so far, characterized by high volatility and big spreads. Let's see if we can get a clear view and understand what we should expect from the future. Charts can say a lot about the future and we want to share with our readers our view of the S&P future.

 

  S&P Future - Weekly Chart 

The uptrend channel started in 2002 was violated and it's not pushing up the S&P future anymore, it's now going to test the 61,8% of the Fibonacci Retracement, where it should find a solid support, furthermore the RSI (a technical analysis indicator which measures the magnitude of gains over a given time period against the magnitude of losses over that period) is oversold.

 

As for the long term scenario, the situation appears now to be compromised giving space to a correction. In October 2007 the S&P future hit its maximum at 1.586,50 drawing a double top (first top March 2000). First Support (S1) is set at 1.270.