How high can the S&P go?

Pabst · Sep 25, 2003

Quote from inandlong:

The 100 is common, but less quoted than the 50 and 200. And yes that support area is right in line with the confluence of the 20, 40, and 50 sma's.

The question needs to be asked, "why did price stop advancing in June?" I think the answer is found in the story told by the weekly and monthly charts. We are trading at September 2001 levels right now. The high for this month is 1040.29. The monthly close for Sep 01 was 1040.94. That is significant.

For all the people who jumped in bargain-hunting then and have held their positions, two full years later they are finally breaking even, if they are lucky enough to be in something that tracks the SP500 fairly closely. So two years later, having held a loser, and being fortunate to be at breakeven finally, and given the "bubble" debacle still fresh in their minds, what do you think a lot of these people are doing? I think they are selling. That period is going to be a natural resistance level.

Now if all this money is selling, and price has held its level, who is buying? And, if the chart nkhoi posted awhile back is foretelling, and we get a measured move higher from this summer's channel, then 1150-1160 is in the picture. And guess what sits at 1157 right now? The weekly 200sma, with the monthly 50sma at 1167!

MA's are like magnets. They represent the mean. Lord knows we all just want to be normal.
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Nice post inandlong.

T-REX · Sep 25, 2003

Quote from Pabst:

Nice post inandlong.
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Diddo.

980.00 is VERY significant.
Multiple closes below this level will send the SPOO's back to
750.00 and beyond!!!!!

Mvic · Sep 25, 2003

though I don't think selling deep in the money puts is the best way to trade it. You collect very little premium on options that are deep in the money, liquidity is low, and you lose at least a couple of points on the spread. Much safer and more profitable to just take a position in the underlying. Your selling of the calls though I think was a very good play and I wish you many more.

Personally I am using the NQ to profit from this move as I think it has the most distance to move.

waggie945 · Sep 25, 2003

Sure.

I knew ya could!

waggie945 · Sep 25, 2003

Love the 40 Day MA!!!!

Caught the dead-ass low of the S&P and the SMH today!

Ka-Ching!!!!

Romeo · Sep 25, 2003

Quote from waggie945:

Love the 40 Day MA!!!!

Caught the dead-ass low of the S&P and the SMH today!

Ka-Ching!!!!

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Yes, it held, for now. But we are approaching that dreaded oct 3rd date. So you keep buying the dips, and I'll check back with you Oct 6th.

inandlong · Sep 25, 2003

That's just it.... when you watch a popularly followed average, you have a definite number by which to be long or short. No guesswork, no "-ish".

When the price of an instrument that fluctuates well above and below a mean is at the mean.... you have an edge.

Mvic · Sep 25, 2003

Romeo. Pabst et al. More down side to come in the next few weeks. I will cover my NQ short (1387 full position) on SP close above 1015.

Mvic · Sep 25, 2003

Congratulations all!

Romeo · Sep 25, 2003

Quote from Romeo:

Whats a positive number? A lower than expected jobless claims? That will send the bonds tanking, and the market as well. My only hope is that there are enough suckers to open the market higher tomorrow.

The best down days usually start with an up opening.
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I obviously said this yesterday. Just goes to show, I'm giving out my good advice AHEAD of time.