The Significance Of The 1220 Level On The S&P500

In the June 16 post ("The S&P500 Since 2007") I displayed an annotated chart of the S&P500.

In that post I stated the following:

As one can see from the chart, one interpretation that can be made is that of a (completed) “Cup & Handle” chart formation as denoted by the green line.  I have added a red line to now denote the 1220 area.  I think it would be significant if the S&P500 falls below this 1220 level now, as the 1220 level is technically significant in many different ways.

Here is that same chart updated through yesterday:

(chart courtesy of StockCharts.com; annotations by the author)

click on chart to enlarge



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During yesterday's decline, the S&P500 failed to find support at this 1220 level, as seen on the chart.  This is very significant, and I don't believe that it bodes well for the stock market in the short-term.

My beliefs about the stock market's future direction are complex; I will elaborate in future posts...
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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1200.07 as this post is written