Aug
30
2010

 

S&P Futures Test Key Long-Term Uptrend Line

The S&P futures were subject hefty selling pressure today and are still trending lower at the moment as investors sent the S&P back below its psychological 1050 level.  The S&P’s negative performance on Monday came without noteworthy data and news, meaning investor sentiment has clearly soured.  Monday’s losses negate Friday’s gains and are setting up equities for monthly losses as August comes to a close.  This is clearly not the performance bulls were looking for as key economic releases approach, beginning with today’s CB consumer confidence figure.  Investors are looking for a slight increase from 50.4 to 50.7.  Should the CB hit 51 then the S&P futures may be able to pare losses and hold around 1050 ahead of Wednesday’s prelim non-farm payrolls release.  On the other hand, if CB consumer confidence drops below 50, or official contraction, then the S&P futures could really test the patience of our key long-term uptrend line originating from 2009 lows and connecting through June 2010 lows.  Should this uptrend line give way then the S&P futures will likely retest 1000 over the near-term.  However, we shouldn’t get too far ahead of ourselves since investor sentiment has been turning at the drop of a dime these days.  The Fed will also release its meeting minutes today, though more emphasis will likely be placed on consumer confidence data since the Fed is expected to have a negative tone in regards to its outlook for economic performance.  Either way, market activity should begin to pick up again as investors gear up for headline employment releases on Friday.        
    
Price: 1045
Psychological: 1050, 1000
 
 
 
 

 
Posted by: Matthew Myers

 

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