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ON THE MARKET - Declining Tops Resistance Still Rules Charts

Tuesday 12-6-2011


Dr. John L. Faessel


Commentary and Insights


Quote of the day

“No matter what the objective of the spending program may be, government expenditures always constitute economic costs that are borne by taxpayers, lenders, or inflation victims."

~ Hans F. Sennholz ~



Declining Tops Resistance Still Rules Charts


EuroLand Bond Yields Continue Precipitous Retreat

Italy 10-year (gross) bond yield – 5.89% off from 7.26% on 11-24

Spanish 10-year (generic) bond yield – 5.11% - off from 6.7% on 11/24


The McClellan Oscillator is in NEUTRAL @ plus 77

Yesterday the stock market was up about 1.51% but at 1:45 Standard and Poor's warned 6 members of the Eurzone that their top tier debt ratings may be downgraded because of ongoing financial and budget turmoil. Even Germany, the region's supposed safe haven, was warned.


From a technical perspective the key declining Tops line resistance at (SPX) 1270 that comes off last July's top tick will be the overriding wall of resistance. The 200-day moving average that comes in at (SPX) 1264 is likewise formidable. The McClellan Oscillator is in neutral at plus 77 so there is "room" before we reach any overboughtness considerations. European headlines will continue to tweak the daily or hourly trade.




The (SPX) closed yesterday at 1157.08



S&P 500 (SPX) - Short term price support is at 1250

Then at 1244 and 1240 and 1233

The 50- moving average support is at (SPX) 1212.

(SPX) support at the August 8th lows is at 1101.

Support at the October 4th lows is at 1074.



Key “declining tops” resistance is at (SPX) 1270

The 200-day moving average resistance is at 1264.

Short term price resistance is at S&P 500 (SPX) 1259

More formidable resistance is at (SPX) 1266

Price resistance at the top- tick of the near four month old consolidation is at 1292 then at 1277.


Monday’s key indicators and metrics:


·                 McClellan Oscillator is Neutral @ plus 77            

·                 VIX – 27.84

·                 Gold (COMEX) $1734.5

·                 Swiss Franc – 1.0867

·                 The Treasury 10-year yield 2.07%

·                 Crude oil (NYMEX) $100.99

·                 CBOE Put / Call Volume Ratio – 0.97

·                 Aussie Dollar – 1.0264

·                 US Dollar Index – 78.67

·                 3-month $ LIBOR at 0.538

·                 Copper – 3.6155

·                 Silver (COMEX) 32.372

·                 Brent Crude $109.91

·                 Euro – 1.3400

·                 Canadian Dollar – 0.9829


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