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Technical Analysis 4_14_2012

|Includes: DIA, FXE, QQQ, SPDR S&P 500 Trust ETF (SPY), USO, XLE, XLF, XLK, XLV


The S&P 500 is trading to the downside this month. The index rallied to the 200-hour moving average and rolled over. We'll be watching to see if 1,350 holds. The daily chart candlestick for Friday suggests the market may head lower.


The Dow is also down on the month. The weekly chart shows a rejection at the 13,300 level. The average could be retesting the 12,200 support level from off of the q4 2011 low. Friday closed roughly on the low. We'll see if 12,650 holds.


The Nasdaq is also trading to the downside this month and could be looking to start and intermediate decline to 2,400. There aren't any signs of a larger sell-off right now; so we are watching for a 7-10% reaction.

Russell 2000

The index hasn't eclipsed the 2011 high. The weekly chart is showing signs of a potentially strong sell-off. That also suggests the 7-10% percent correction thesis could be correct. This index actually broke the March low; we'll see if 780 holds.


We could see the Euro head to 1.16 based on the daily chart highs and lows pattern. There could be a "rising three"? formation that could lead to selling taking the euro below 1.26. The euro is in a downtrend and recently found selling at the 1.33 level. A move above 1.35 could force some bears to cover. The expectation continues to be of a trend continuation leaving 1.2450 open on the downside.

30yr Bond

The 30yr is rallying this month. The bond bounced off of the 50-week moving average and is rallying to retest 146. The contract should continue above 142 this week. A reversal at 142 is possible.

10yr bond

Is stronger than the 30yr. Looks ready to take out 132 and move higher. Near-term, this week, we are looking for a move above 132 or a failure at this level.


Crude is trading to the downside for the second month. It could be finding support at the $100 zone. We'll watch to see if $101 holds.


The precious metal has been trading down the past 3 months without much conviction. Gold is hanging around the $1,650 inverse head & shoulders, shoulder level. The near-term trend is down, but stabilizing. We'll see if the $1,650 level holds early next week.


The currency is trading up this month. The weekly chart suggest a base formed and the weekly trend is bullish near-term. The yen is in an overall uptrend. Watch the yen for a rally to fresh highs this week after a falling three formation that should lead to a bullish engulfing.