The 10 month consolidation ends with a breakout into a new trading range — and (of course), that’s bullish. Traders should use the double red line as their stop loss — any break of that suggests a market sliding back into the prior range.

SPX Breakout within the larger uptrend channel 
click for larger chart

Spx_breakout_12_2004
Chart courtesy of Redwood Technimentals

Note that the upper green line of the channel — 1310 or so — becomes the new target.

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Quote of the Day
"Your emotions are often a reverse indicator of what you should be doing."
-John F. Hindelong

Category: Markets

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3 Responses to “Chart of the Week: S&P 500 Breakout”

  1. blo5ish says:

    cool, man. now, all i want to know is when that chinese economy is gonna nosedive.

  2. dsquared says:

    Interesting thing is, that breakout coincides exactly with a nasty leg down on the US$ – I haven’t looked at the chart, but suspect that euro-denominated investors are still stuck in a range.

  3. 张家界 says:

    Very good Thank author this article is quite good!