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S&P 500 INDEX - Temporary pullback

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Colins-Technical-Takes

Recommendation: BUY AGAIN AFTER A PULLBACK

Current Trend: Short-term technically still down. Med-term sideways. Long-term up.

Strategy: Buy again on a pullback to/near line 1, on a reversal day up from there. 

Screen Shot 2018-02-25 at 14.15.31.png

Chart Setup: The S&P had a good rebound rally into our target price zone. It then gave a bearish reversal candle (‘shooting star’) on last Friday night and is pulling back so far. I'm looking for more of a pullback before it heads up again. The odds greatly favour the low being ‘in’ (9th Feb).

  • Short-term Stochastic is pulling back from its overbought zone, and is not yet oversold.

Strategy Details: Buy (go long) again on from (or near) a support zone formed by lines 1 and 2 (2672-2640, respectively).  Wait for a reversal day/candle up from there to enter.

Target: Besides the pullback potential to lines 1 and 2; to the upside thereafter take half profits at 2792. And more at 2850 if reached. There’s a reasonably good chance it makes its way back to a new all time high. 

Stop-loss: A close below 2600 when buying after the correction. Once it trades back above 2710 raise the stop to the low of the correction, and from 2775 raise a trailing stop to a breaking of its prior two-day low.


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