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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