S&P Chart Warning as Industry Leaders Add Pressure

Stocks are sliding a bit on Monday after more caution from Europe and on more economic slowing trends. The chart analysis today shows that caution and patience would remain the best action. Today we are analyzing the SPDR S&P 500 (NYSEMKT: SPY) as it is the most liquid of all ETFs.

Another 2% drop in Intel Corp. (NASDAQ: INTC) and a 3% drop in United States Steel Corp. (NYSE: X) are keeping the drop in the S&P 500 from real recovery as the industry leaders are keeping pressure up on peers and related companies in their sectors.

For Monday’s chart analysis, Phil Erlanger said, “SPY opened with a gap down below support at $145.56. The five minute range is important on a gap down day as are the one hour ranges. The 5 minute range is $145.21 to $145.04. Unless we can rebound through and hold above the 5 minute high and then the one hour high we would not be a buyer today.”

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SEPTEMBER 24, 2012