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S&P 500 analysis for Jan 19-22

What an interesting week it was for the stock market.  Here we look at the S&P 500 for the shortened trading week of January 19-22.  But first, it was an interesting past week, and shows us a lot about what to expect going forward.

First off, some non-technical notes:  Wednesday was interesting; a MASSIVE order of more than a quarter million went through in the S&P minis!  That is a notional value of about $12,961,800,00.00!

There are rumors that the market is being kept higher by the Fed...that they may in fact be the mystery buyer of this market.  I don't know if that is the case, but either way this market was marched higher in after hours trading during the last few months of 2009 and now intra-day we are seeing aggressive buying come into the market at key technical levels to keep this market in a technical uptrend.

No matter what the reason, price is what matters and here are the levels to watch for the upcoming week as shown on the chart.  Key support comes in between 1132-1130 which held off aggressive selling on Friday.  A break of that level does damage to the uptrend.  Some support comes in at 1128 with further support coming in at 1123.50 and 1116-1114.80.  The target for the breakout below 1130 is 1110.

The rising trend line which was broken on Friday (see chart) will act as resistance on the move back higher - on Tuesday this will be between 1140 and 1142 but will increase over time.  A push back above that line indicates a move towards the upper trend channel with resistance along the way at 1144, 1148 and then recent highs at 1150.  With “nothing but air” on the upside, resistance beyond comes in just below 1154, followed by 1160 and 1168.  After this little resistance remains until 1180.

The average weekly true range stands at just about 30 points.  Keep in mind it is also a shortened week for stocks due to a holiday on Monday.

CFD trading analysis written by Cory Mitchell, CMT, Vantage Point Trading, for CFDsPros. For information on stocks and real time stock quotes see CFDsPros.