Does the S&P finally have the gumption to hold territory above 1000?
Every technician and their aunt Tillie have been keenly watching to see if the markets can emerge unscathed from the area just north of 1000, where investors repeatedly faced stiff headwinds and turned back.
We broke through 1000 again this morning. And early this afternoon, the broad stock measure was clonking off 1005 like a pigeon off a freshly cleaned window. Eventually, it broke through and we closed over 1007.
Two reasons investors go greenish around this altitude. For one thing, 1007.5 was the November high etched midday back in a burst of electoral exhuberance on Nov. 4. We’ve since trod back and forth across that level, even closing above it a few days. But the S&P subsequently slipped below 1000 again, before emerging today.
Since the November highs held so long, the 1007 level has become an important frame of reference for the market, technicians say. Below it, investors get that safe, cuddly feeling, as the S&P has proven it can hold that territory. Above it — at least in recent months — there be dragons....MORE