Standard & Poor's 500 Index Trend Analysis

Standard & Poor's 500 Index Trend Analysis

It was the first positive week for the S&P 500 (^GSPC). During the week, the ^GSPC gained 24.01 points, or 2.18%, and closed at 1126.48 on Thursday, December 24, 2009. Weekly volume was -40% below average.

The Christmas rally has pushed the stocks ahead and the trend following indicators have turned bullish. The daily MACD line has moved above its signal line. The price has closed on Friday above the upper Bollinger Band. Almost 20% of S&P 500 members are overbought. Daily and weekly oscillators are overbought and strongly overbought. The bearish divergence is everywhere. It indicates that the rally is exhausted and a trend reversal is expected soon.

Standard & Poor's 500

Weekly Technical Indicators: Weekly Lane's Stochastic is overbought while Williams' Percentage Range is strongly overbought. Weekly MACD has bearish divergence. The divergence between price and indicator is considering one of the most important buy/sell stocks trading signal. Oscillators are designed to signal a possible trend reversal. The weekly MACD line is above its signal line since March 13, 2009.

Daily Technical Indicators: Daily Williams' Percentage Range and Lane's Stochastic are overbought. Daily Lane's Stochastic and MACD have bearish divergence. During the last week, daily MACD line has moved above its signal line. Such crossover is considered a bullish signal.

The price has closed on Friday above the upper Bollinger Band. The distance between the Bollinger Bands is falling and it was 3.3% on Friday. It is 33.55% lower then two years average. It indicates the period of low volatility of the stock price.

Standard & Poor's 500 - Bollinger Bands

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Weekly Stock Market Overview - 12/24/2009

It was an up week for the major markets. For the week the Dow Jones Industrial Average gained 191.21 points or 1.85%. The Standard & Poor's 500 Index gained 24.01 points or 2.18%, while the Nasdaq Composite gained 74.00 points or 3.35%.

The Materials sector was the strongest sector (4.44%) last week followed by the Technology sector (3.05%). The Utilities sector was the worst performing sector (0.41%) of the week followed by the Health Care sector (1.06%).

The Technology sector is the most overvalued sector followed by Basic Materials, while Information Technlgy Svcs, Diversified Computer Sys, and Semiconductr-Memory Chips are among the most overvalued industries. The Utilities sector is the most oversold sector followed by Healthcare, while hospitals, Biotechnology, and Medical Instruments/Supls are among the most oversold industries.

Weekly S&P 500 Winners

Gains/Loses(%) Symbol Company Sector 24.78% MBI MBIA Inc. Financials 20.14% SNDK SanDisk Corp. Information Technology 17.70% JBL Jabil Circuit Information Technology

Weekly S&P 500 Loosers

Gains/Loses(%) Symbol Company Sector -10.73% CTAS Cintas Corporation Industrials -6.45% MOT Motorola Inc. Information Technology -5.64% DYN Dynegy Inc. (New) Class A Utilities

The Stock Market Week - 9/25/2009

All the major US indices were negative. For the week the Dow Jones Industrial Average dropped -155.01 points or -1.58%. The Standard & Poor's 500 Index dropped -23.92 points or -2.24%, while the Nasdaq Composite dropped -41.94 points or -1.97%.

The Consumer Staples sector was the strongest sector (-0.63%) last week followed by the Health Care sector (-0.80%). The Materials sector was the worst performing sector (-4.59%) of the week followed by the Financial sector (-3.63%).

The Utilities sector is the most overvalued sector followed by Basic Materials, while Chemicals-Major Diversifd, Copper, and Agricultural Chemicals are among the most overvalued industries. The Financial sector is the most oversold sector followed by Industrial Goods, while Savings & Loans, Waste Management, and Lumber Wood Production are among the most oversold industries.

Weekly S&P 500 Winners

Gains/Loses(%) Symbol Company Sector 11.75% AIG American Int'l. Group Financials 5.43% MBI MBIA Inc. Financials 5.04% F Ford Motor Consumer Discretionary

Weekly S&P 500 Loosers

Gains/Loses(%) Symbol Company Sector -20.09% MCO Moody's Corp Financials -16.08% KBH KB Home Consumer Discretionary -12.82% EK Eastman Kodak Consumer Discretionary

Standard & Poor's 500 Index Trend Analysis The current S&P 500 up trend has an ABC structure. The first leg up (wave A) presents a sharp advance from 666.75 on March 6th to 956.23 on June 11th. The second leg up (wave C) advanced from 869.35 in July to 1080.15 on September 23rd (29% shorter than wave A). In our previous publication we wrote: the next up leg could reach the resistance level around 1075 in the beginning of October. The S&P 500 was able to reach the resistance level even earlier, but it was not able to close above the resistance level so far. The resistance caused a sharp sell off. The S&P has lost 3.3% in two days. Weekly Williams' % Range indicator is still overbought while weekly Lane's Stochastic is strongly overbought. Daily Lane's stochastic crossed over its moving average above 80%, which is considered as a sell signal. The next support level is near 970.

Standard & Poor's 500

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Weekly Stosk Market Update - 9/11/2009

The Greedy Trader Weekly Analysis Sign In 9/11/2009 Weekly Stock Market Overview It was an up week for the major markets. For the week the Dow Jones Industrial Average gained 164.14 points or 1.74%. The Standard & Poor's 500 Index gained 26.33 points or 2.59%, while the Nasdaq Composite gained 62.12 points or 3.08%. The Energy sector was the strongest sector (5.18%) last week followed by the Industrial sector (4.11%). The Utilities sector was the worst performing sector (0.07%) of the week followed by the Health Care sector (1.51%). The Consumer Goods sector is the most overvalued sector followed by Technology, while Semiconductr-Memory Chips, Printed Circuit Boards, and Housewares & Accessories are among the most overvalued industries. The Utilities sector is the most oversold sector followed by Services, while Publishing - Books, Auto Parts Stores, and Restaurants are among the most oversold industries. Weekly S&P 500 Winners Gains/Loses(%) Symbol Company Sector 28.61% MTW Manitowoc Co. Industrials 25.39% AMD Advanced Micro Devices Information Technology 17.75% PCS MetroPCS Communications Inc. Telecommunications Services Weekly S&P 500 Loosers Gains/Loses(%) Symbol Company Sector -7.03% FITB Fifth Third Bancorp Financials -6.24% AIG American Int'l. Group Financials -5.36% AEE Ameren Corporation Utilities Weekly S&P 500 Alerts Stock Market Alerts Count Downtrend Exhaustion 0 Downtrend Broken Resistance 4 Uptrend Support 6 Uptrend Exhaustion 50 Uptrend Broken Support 6 Downtrend Resistance 25 Oversold 0 Overbought 144

Stock Market Wave Analysis – 9/4/2009

The Standard Poor's 500 Index is forming a rising wedge chart pattern. A rising wedge is generally considered bearish and it is usually found in downtrends. A rising wedge forms over a 3-6 months period. The current up trend is totally contained within the rising wedge. From low 666.75 on March 6th, S&P 500 surpassed 1000 in less than 6 months. The Elliott Wave count of the S&P 500 index is shown below. The wage has formed an A-B-C-D wave structure with the wave D currently in progress. Rising A and C waves have similar five sub wave structures with bearish divergence between sub wave 3 and 5. Wave B is a three-wave Zig-Zag correction. For the count to be correct, wave D must be forming a three-wave Zig-Zag correction at present. The support line is now near 970. The first leg up (wave A) was a sharp advance from 666.75 on March 6th to 956.23 on June 11th. The second leg up (wave C) advanced from 869.35 in July to 1039.47 in August (41% shorter than wave A). If support holds, the next up leg could reach the resistance level around 1075 in the beginning of October. A rising wedge chart pattern technical targets are usually derived by subtracting the height of the pattern from the eventual breakout level. If wave D breaks the support line, the technical target is around 770.

Standard & Poor's 500

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The Stock Market Week - 7/24/2009

It was an up week for the major markets. The Standard & Poor's 500 Index reached 979.8, the highest level since November 5th 2008. For the week the Dow Jones Industrial Average gained 349.30 points or 3.99%. The Standard & Poor's 500 Index gained 38.88 points or 4.13%, while the Nasdaq Composite gained 79.35 points or 4.21%.

The Materials sector was the strongest sector (8.04%) last week followed by the Energy sector (5.66%). The Financial sector was the worst performing sector (2.31%) of the week followed by the Consumer Staples sector (2.51%).

The Basic Materials sector is the most overvalued sector followed by Technology, while Security Software & Svcs, Personal Computers, and Diversified Computer Sys are among the most overvalued industries. The Services sector is the most oversold sector followed by Healthcare, while Food Wholesale, Drugs Wholesale, and Electronics Stores are among the most oversold industries.

Weekly S&P 500 Winners

Gains/Loses(%) Symbol Company Sector 10.23% RSH RadioShack Corp. Consumer Discretionary 10.11% BDK Black & Decker Corp. Consumer Discretionary 9.72% PLD ProLogis Financials

Weekly S&P 500 Loosers

Gains/Loses(%) Symbol Company Sector -8.26% MSFT Microsoft Corp. Information Technology -6.79% BRCM Broadcom Corporation Information Technology -5.50% FII Federated Investors Inc. Financials

Weekly S&P 500 Alerts

Stock Market Alerts Count Downtrend Exhaustion 0 Downtrend Broken Resistance 5 Uptrend Support 2 Uptrend Exhaustion 19 Uptrend Broken Support 0 Downtrend Resistance 27 Oversold 1 Overbought 109

Standard & Poor's 500 Index Trend Analysis

In our previous publication on June 7th we wrote:

	132 out of S&P 500 members have an Uptrend Support alert. If support holds and price does not breakdown the neckline, the uptrend may resume and we may see S&P above the 1000 mark pretty soon.

The Standard & Poor's 500 Index gained more than 12.7% since July 8th, and almost 47% since March 6th, reaching 979.8 on Friday, the highest level since November 5th, 2008. Daily Lane's Stochastic, Williams' % Range and Relative Strength Index are overbought/strongly overbought for all three major US indices. Weekly Williams' % Range is strongly overbought, signaling that market is moving too fast in a weekly time frame as well; and the rally may not be sustainable for a long period. 109 out of S&P 500 members are overbought, 51 stocks have daily MACD bearish divergence, indicating that the rally is already slowing down. The next resistance level for S&P 500 index is around 993. Considering overbought technical indicators, it would be difficult to break this resistance level; and chances are high that the stock market trend may reverse soon.

Standard & Poor's 500

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S&P 500 - head and shoulders pattern

The Stock Market Week - 7/10/2009

All the major US indices were negative. For the week the Dow Jones Industrial Average dropped -134.22 points or -1.62%. The Standard & Poor's 500 Index dropped -17.29 points or -1.93%, while the Nasdaq Composite dropped -40.49 points or -2.25%.

The Consumer Staples sector was the strongest sector (0.00%) last week followed by the Health Care sector (-0.43%). The Materials sector was the worst performing sector (-3.34%) of the week followed by the Energy sector (-3.23%).

The Healthcare sector is the most overvalued sector followed by Industrial Goods, while Drug Delivery, Medical Labs & Research, and Specialized Health Svcs are among the most overvalued industries. The Utilities sector is the most oversold sector followed by Consumer Goods, while Photographic Equip/Supls, Recreational Vehicles, and Business Equipment are among the most oversold industries.

Weekly S&P 500 Winners

Gains/Loses(%) Symbol Company Sector 8.49% HAR Harman Int'l Consumer Discretionary 5.45% HBAN Huntington Bancshares Financials

Weekly S&P 500 Loosers

Gains/Loses(%) Symbol Company Sector -17.74% CIT CIT GROUP INC Financials -5.00% NWSA News Corporation Consumer Discretionary -4.90% VMC Vulcan Materials Materials

Standard & Poor's 500 Index Trend Analysis

In our previous publication on June 7th we wrote:

S&P and Nasdaq have an Uptrend Exhaustion alert. This alert indicates that the uptrend is exhausted and the trend is about to reverse. ... there is still too much bullish force for the stock to decline sharply. On the other hand, it is recommended to set a tight stop.

On June 11th S&P 500 index reached 956.23 making six months high. Since then the trend turned down and S&P lost almost 10% reaching 869.32 on Wednesday July 8th. The short term trend has formed the head and shoulders pattern. The right shoulder is completed and price is near the neckline.

Standard & Poor's 500

Daily Williams' % Range indicator is oversold for all three major indices (S&P 500, Dow Jones, and Nasdaq). Daily Lane's Stochastic indicator is oversold for S&P and Nasdaq as well. 132 out of S&P 500 members have an Uptrend Support alert. If support holds and price does not breakdown the neckline, the uptrend may resume and we may see S&P above the 1000 mark pretty soon. If price breaks down the neckline, it would confirm the head and shoulders pattern. Next support level is near 825. Then price may retest the March's low level (666.78).

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S&P 500 - Uptrend Exhaustion alert

On Friday, June 5th Standard & Poor's 500 indices reached 951.69 making the 28 weeks' high. Index has gained almost 43% since March's low (666.78). Technical indicators show that this rate of growth may not be sustainable. All three major US indices are strongly overbought in daily and weekly time frames. Standard & Poor's 500 and Dow Jones have MACD Bearish Divergence. Almost 30% of S&P 500 members are overbought, and more than 10% are near the resistance level, while almost 20% have daily MACD Bearish Divergence. S&P and Nasdaq have an Uptrend Exhaustion alert. This alert indicates that the uptrend is exhausted and the trend is about to reverse. The next S&P resistance level is near 1044, but chances are high that S&P may not reach this level soon. The support is near 470.

Standard & Poor's 500

On Friday 35 members of S&P 500 index had a Bearish Dark Cloud Cover candlestick pattern. The Dark Cloud Cover pattern occurs often in a strong uptrend. This pattern is considered as an indication of a future bearish trend. It is more reliable when confirmed by other technical indicators, such as bearish divergence. The Dark Cloud Cover often occurred when there is still too much bullish force for the stock to decline sharply. On the other hand, it is recommended to set a tight stop.

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Weekly Market Update

The Greedy Trader Weekly Analysis 5/29/2009 Weekly Stock Market Overview It was an up week for the major markets. For the week the Dow Jones Industrial Average gained 223.01 points or 2.69%. The Standard & Poor's 500 Index gained 32.14 points or 3.62%, while the Nasdaq Composite gained 82.32 points or 4.87%. The Energy sector was the strongest sector (6.32%) last week followed by the Financial sector (4.89%). The Consumer Staples sector was the worst performing sector (0.83%) of the week followed by the Health Care sector (2.14%). The Technology sector is the most overvalued sector followed by Basic Materials, while Technical/System Software, Oil & Gas Drilling/Exploration, and Copper are among the most overvalued industries. The Utilities sector is the most oversold sector followed by Consumer Goods, while Photographic Equip/Supplies, Dairy Products, Beverages-Winery/Distillers are among the most oversold industries. Weekly S&P 500 Winners Gains/Loses(%) Symbol Company Sector 13.08% THC Tenet Healthcare Corp. Health Care 10.76% NWSA News Corporation Consumer Discretionary 8.81% CIT CIT GROUP INC Financials Weekly S&P 500 Loosers Gains/Loses(%) Symbol Company Sector -33.04% GM General Motors Consumer Discretionary -6.09% NOVL Novell Inc. Information Technology -5.36% CTAS Cintas Corporation Industrials Weekly S&P 500 Alerts Stock Market Alerts Count Downtrend Exhaustion 1 Downtrend Broken Resistance 2 Uptrend Support 13 Uptrend Exhaustion 6 Uptrend Broken Support 1 Downtrend Resistance 15 Oversold 4 Overbought 48

S&P 500 index has a downtrend resistance alert

The Stock Market Week - 5/8/2009

It was an up week for the major markets. For the week the Dow Jones Industrial Average gained 362.24 points, or 4.41%. The Standard & Poor's 500 Index gained 51.71 points or 5.89%, while the NASDAQ Composite gained 19.80 points or 1.15%. The Financial sector was the strongest sector (22.25%) last week followed by the Energy sector (9.69%). The Technology sector was the worst performing sector (-2.23%) of the week followed by the Utilities sector (2.71%). The Basic Materials sector is the most overvalued sector followed by Services, while Publishing - Periodicals, Publishing - Books, Lodging are among the most overvalued industries. The Technology sector is the most oversold sector followed by Financial, while Computer Peripherals, Savings Loans, REIT - Industrial are among the most oversold industries.

Weekly S&P 500 Winners

Gains/Loses(%) Symbol Company Sector 19.90% PKI PerkinElmer Health Care 13.66% FLIR FLIR Systems Inc. Information Technology 13.58% MEE Massey Energy Co. Materials

Weekly S&P 500 Loosers

Gains/Loses(%) Symbol Company Sector -13.79% AOC Aon Corp. Financials -12.59% WPO Washington Post Co. Consumer Discretionary -8.55% DF Dean Foods Consumer Staples

Standard & Poor's 500 Index Trend Analysis Standard & Poor's 500 Index daily Greed/Fear Indicator and weekly Williams' Percentage Range are overbought, while daily and weekly Lane's Stochastic are strongly overbought. Weekly Williams' Percentage Range has bearish divergence. S&P 500 index has a downtrend resistance alert. The resistance is near 944. The short-term ABC zigzag pattern is almost completed.

Standard & Poor's 500 - short term ABC zigzag

Below is an example of the similar S&P 500 long-term ABC zigzag pattern with the following down turn.

Standard & Poor's 500 - long term ABC zigzag

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The upside potential is limited

The Stock Market Week - 5/1/2009

It was an up week for the major markets. For the week the Dow Jones Industrial Average gained 136.12 points, or 1.69%. The Standard & Poor's 500 Index gained 11.29 points, or 1.30%, while the NASDAQ Composite gained 24.91 points, or 1.47%. The Utilities sector was the strongest sector (4.61%) last week followed by the Consumer Staples sector (2.74%). The Financial sector was the worst performing sector (-2.65%) of the week followed by the Industrial sector (1.57%). The Basic Materials sector is the most overvalued sector followed by Conglomerates while Agricultural Chemicals, Chemicals-Major Diversified, Copper are among the most overvalued industries. The Industrial Goods sector is the most oversold sector followed by Services while Education Training Services, Drugs Wholesale, Rental Leasing Services are among the most oversold industries.

Standard & Poor's 500 Index Trend Analysis Standard & Poor#39;s 500 Index is in a long-term downtrend that started on 10/11/2007 at 1576.09. According to the Elliot Wave Principle, the market’s progress ultimately takes the form of a five wave structure. The first (I) wave down has been completed on 1/23/2008 at 1270.05 and dropped almost 20%. According to the Wave Principle, the third wave is the strongest and the broadest, and it generates the greatest volume and price movement. The third (III) wave down has started on 5/19/2008 at 1440.24 and dropped more than 48.5%, reaching 741.02 level on 11/21/2008. From a long term perspective there are two scenarios that we are going to consider: Scenario #1: The last fifth wave of the long-term down trend has been completed on March 6th at 666.79. The first wave of a new long-term uptrend is in progress. See the chart below.

Standard & Poor's 500 - Scenario #1

Scenario #2: The forth wave of the long-term down trend is in progress and almost completed. The last fifth wave down is about to begin. The fifth wave will retest the March low and possibly move further down. See the chart below.

Standard & Poor's 500 - Scenario #2

Now the price is near the resistance level. Weekly Lane's Stochastic is oversold. Daily technical indicators are close to oversold area as well. In both scenarios the upside potential is limited and chances are high that price will turn down soon. The support is near 805 and the next resistance is near 944.

Standard & Poor's 500

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S&P 500 chart has formed the broadening wedge

The Stock Market Week - 3/27/2009

It was an up week for the major markets. For the week the Dow Jones Industrial Average gained 497.80 points, or 6.84%. The Standard & Poor's 500 Index gained 47.40 points, or 6.17%, while the Nasdaq Composite gained 87.93 points, or 6.03%. The Financial sector was the strongest sector for the second week followed by the Industrial sector. The Utilities sector was the worst performing sector for the second week followed by the Health Care sector. Technology, Services, and Basic Materials are the most overvalued sectors while Agricultural Chemicals, Auto Parts Stores, and Copper are the most overvalued industries. Conglomerates and Financial are the most oversold sectors while Regional-Pacific Banks, REIT - Diversified, Gaming Activities, and REIT - Retail are among the most oversold industries.

Standard & Poor's 500 Index Trend Analysis In our last publication on February 22 we have suggested that downtrend should be completed in approximately a week or two (February 25 – March 6) with the target around 650. The S&P 500 downtrend has been completed on March 6th at 666.79. A strong uptrend is in progress now. S&P 500 index has reached 832.98 on Thursday posting almost 25% gain since March 6th. Standard & Poor#39;s 500 Index is in a long-term downtrend that started on 10/11/2007 at 1576.09. According to the Elliot Wave Principle, the market’s progress ultimately takes the form of the five waves structure. The first (I) wave down has been completed on 1/23/2008 at 1270.05 and dropped almost 20%. According to the Wave Principle, the third wave is the strongest and the broadest, and it generates the greatest volume and price movement. The third (III) wave down has started on 5/19/2008 at 1440.24 and dropped more than 48.5%, reaching 741.02 level on 11/21/2008.

Standard & Poor's 500 - Long-Term Trend (two years)

Since 11/21/2008 the S&P 500 chart has formed the broadening descending wedge. The formation might be completed, but there is a chance that it is still in progress. In this case the price may reach the resistance level and turn down to retest the support line.

Standard & Poor's 500 - Medium-Term Trend (one year)

Daily Williams' % Range (W%R) is strongly overbought and Lane's Stochastic is overbought. The price uptrend may pause for a while to reset technical indicators before the next up move toward the resistance line.

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S&P 500 chart wave analysis

The Stock Market Week - 2/20/2009

All the major US indices were negative. For the week the Dow Jones Industrial Average dropped 484.74 points, or 6.17%. The Standard & Poor's 500 Index dropped 56.79 points, or 6.87%, while the Nasdaq Composite dropped 93.13 points, or 6.07%. The Consumer Staples sector was the strongest sector last week followed by the Health Care sector. The Financial sector was the worst performing sector of the week followed by the Energy sector. S&P 500 chart wave analysis and technical indicators suggest that the downtrend might be close to completion with the target around 650.

Standard & Poor's 500 Index Trend Analysis Standard & Poor's 500 Index is in a long-term down trend that started on 10/11/2007 at 1576.09. According to the Elliot Wave Principle, the market’s progress ultimately takes the form of the five waves structure. The first (I) wave down has been completed on 1/23/2008 at 1270.05 and dropped almost 20%. According to the Wave Principle, the third wave is the strongest and the broadest and it generates the greatest volume and price movement. The third (III) wave down has started on 5/19/2008 at 1440.24 and dropped more than 48.5%, reaching 741.02 level on 11/21/2008.

Standard & Poor's 500 - Long-Term Trend (two years)

The fifth (V) wave is in progress now. It has started on 1/69/2009 at 943.85 and dropped more than 20% so far reaching 754.25 on 2/20/2009. The fifth (V) wave has three sub waves: 1. - a, b, c, d, e, f, g structure 2. - a, b, c structure 3. - a, b, c, d, e . . . structure Sub wave 3 is in progress now.

Standard & Poor's 500 - Medium-Term Trend (one year)

In three waves structure the sub wave 3 is usually similar to the sub wave 1. The sub wave 3 has formed a, b, c, and d sub waves; the e sub wave is in progress now. To complete the pattern, the sub wave 3 should complete e, f, and g sub waves. In this scenario, the downtrend might be completed in approximately a week or two with the target around 650.

Standard & Poor's 500 - Short-Term Trend (six months)

Daily Williams' % Range and Lane's Stochastic are oversold while weekly Williams' % Range is strongly oversold. More than 20% of S&P 500 index members are oversold while only one is overbought. Technical indicators confirm the wave structure analysis that the downtrend might be close to completion.

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The S&P 500 index is forming a triangle pattern

The Stock Market Week - 1/16/2009

All the major US indices were negative. For the week the Dow Jones Industrial Average dropped 317.96 points, or 3.70%. The Standard & Poor's 500 Index dropped 40.23 points, or 4.52%, while the Nasdaq Composite dropped 42.26 points, or 2.69%. The Financial sector was the worst performing sector for the fourth consecutive week followed by the Industrial sector. The Consumer Staples sector was the strongest sector last week followed by the HealthCare sector. The Healthcare is the most overvalued sector, followed by Utilities, while Gold and Drugs - Generic are among the most overvalued industries. Financial is the most oversold sector, followed by Basic Materials while Regional-Pacific Banks, Railroads, Oil Gas Drilling/Explore are among the most overvalued industries.

Standard & Poor's 500 Index Trend Analysis Standard & Poor's 500 Index is in a long-term down trend that started on 10/11/2007 at 1576.09. According to the Elliot Wave Principle, the market's progress ultimately takes the form of the five waves structure. The first (I) wave down has been completed on 1/23/2008 at 1270.05 and dropped almost 20%. According to the Wave Principle, the third wave (III) is the strongest and the broadest and it generates the greatest volume and price movement.

Standard & Poor's 500 - Long-Term Trend (two years)

The third (III) wave down has started on 5/19/2008 at 1440.24 and dropped more than 48.5%, reaching 741.02 level on 11/21/2008. The third wave usually has the five-sub waves structure itself. It has formed four waves so far.

Standard & Poor's 500 - Medium-Term Trend (one year)

The third wave has reached the long-term support trend line in mid October. Since mid October the chart is forming a horizontal expanding triangle pattern. Usually a horizontal triangle pattern presents a corrective wave. The triangle reflects a balance of forces and causes a sideway movement. The triangle pattern consists of five overlapping waves A-B-C-D-E that subdivide 3-3-3-3-3. Usually the corrective wave resets technical indicators to natural to prepare the next price move into the major trend direction. Weekly Lane's Stochastic and Relative Strength Index have been reset from oversold to 55.55% and 46.48% accordingly. Weekly Williams Percentage Range is oversold, and this is an indication of the beginning of a sharp down move. The horizontal triangle support is near 600, and resistance around 959.

Standard & Poor's 500 - Short-Term Trend (six months)

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