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Pullback Expected, Will It Have Legs? | Weekly Stock Market Outlook for 11-23-2009

|Includes: DXD, Direxion Daily Financial Bull 3x Shares ETF (FAS), FAZ, GLD, SPY, SPY, SSO

 Stock Market Outlook

Looking into the new week I see a pullback to 1070 as the most probable price point to be hit for Monday. Everything is lining up for a pullback here. Although my bias is to the short side beyond that, I strongly respect the fact that for every pullback we have had – just like the one I expect to have Monday – buyers coming into market support it the following day. Then it generally rallies beyond that to a higher high. Will it happen again? Who knows. This is just something I am keeping my eyes on.

Let’s look at the daily chart and call it a wrap!

Daily SPX Chart

Most technicals are still strong, but it appears that CCI and MACD will be weighing the market down come Monday. Volume still remains dry for this time of the year, and next week should be light again for it is Thanksgiving week. If we see a pullback on Monday, it may pay off to try and go long at 1070 on the SPX as buyers could remain the upper hand. However, a break down could mean volatility and bears are coming back into the market.

Good luck and happy trading!

Disclosure: No Positions