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What is the Market's Trading Range?

|Includes: DIA, IWM, QQQ, SPDR S&P 500 Trust ETF (SPY), SPY

Fibonacci Retracment rears its head again.

We've been watching the big picture market retracement rally for some time.  From the 2007 S&P 500 Index (SPX) (NYSEARCA:SPY) highs to the 2009 panic lows, we've now regained a significant amount of the losses.  The problem?  The 50%, 61.8% and 31.8% Fibonacci retracement levels now become potential resistance levels to further market upside.

Take a look at the SPX Weekly Chart below that we've discussed previously:

SPX Weekly Chart

You can see that the recent market correction began after we approached the 61.8% retracement level around 1,228.  We've now busted down through the 50% level of 1,133, and look like a test of 1,014 (roughly 1k) is approaching.  One potential positive to note is that we are right around a key level if you draw a trendline of the lows from late 2009 -- if this area holds as support, we could see a weekly bounce to 1,150 or 1,200.  Remember though, that these are longer-term weekly charts and the trends are fairly wide as are the weekly high/lows.  That's why we utilize Hourly, Daily and even shorter-term charts four real-time trade recommendations.

Disclosure: No positions.