SPX Support, Resistance (S/R) and Moving Averages for Trading the Week of 12/31/12

SPX support, resistance (S/R), moving averages and other important levels are highlighted below. A formidable ceiling exists at 1419-1422. The 200 EMA on the 60-minute chart at 1418 is a critical level that signals continual market weakness ahead and must be watched if markets bounce. As long as the SPX stays under 1418, the bears will be growling strongly moving forward. The bulls will regain strength and control of the markets if they can bust up thru the 1418-1422 gauntlet.

The SPX tried to find support at the important 50-day MA at 1412 but that level failed. Note how the three recent major quantitative easing measures have all failed; the ECB's OMT program at 1403, QE3 Infinity at 1438 and QE4 Infinity and Beyond at 1430. There are three key support levels before the markets would go over Niagra Falls; 1394, 1390 and 1384.  The 1384 is the last chance support, the broad indexes would fall into a cyclical bear market that would last weeks, months, perhaps a year or two or more if 1384 fails.

For Monday, the last trading day of 2012, the bulls need to recover Friday's move and push above 1418 to accelerate further upside.  If the SPX recovers and pokes up thru 1418 (which would be on positive fiscal cliff news), the 1418-1422 gauntlet would likely give way with price moving above 1422. The bears need to push under 1402, only pennies lower, to create a downside acceleration that would likely send price to directly test 1394. The Sunday futures and Asian and European markets are not only important to watch to see if a cascading market event is beginning, but also any smidge of negativity in the futures will be enough to create the downside acceleration.  Obviously, if the fiscal cliff news is negative on Sunday evening and overnight into Monday, the SPX can easily cascade down thru the 1390's in quick order.  A move thru 1403-1417 is sideways action.

·         1476

·         1475 (9/14/12 Intraday HOD for 2012: 1474.51)

·         1472

·         1468

·         1466 (9/14/12 Closing High for 2012: 1465.77)

·         1465

·         1461

·         1460

·         1457

·         1453

·         1451

·         1447

·         1446

·         1444

·         1441

·         1440 (5/19/08 Intraday HOD for 2008: 1440.24)

·         1438 (9/13/12 Fed Announces QE3 Infinity)

·         1435

·         1433

·         1431

·         1430 (12/12/12 Fed Announces QE4 Infinity and Beyond)

·         1429 (11/6/12 President Obama Election Top)

·         1427 (5/19/08 Closing High for 2008: 1426.63)

·         1426.74 (10-day MA)

·         1424

·         1422

·         1421.79 (20-day MA)

·         1420.93 (20-week MA)

·         1420.71 (100-day MA)

·         1419

·         1418.10 Friday HOD

·         1417.83 (200 EMA on 60-Minute Chart a Keystone Turn Signal)

·         1416

·         1414

·         1413

·         1412.07 (50-day MA)

·         1409

·         1406 (5/29/08 HOD: 1406.32)

·         1404

·         1403 (9/6/12 ECB Announces OMT Bond-Buying Program)

·         1402.43 Friday Close – Monday Starts Here

·         1402

·         1401.58 Friday LOD

·         1399

·         1397

·         1394.31 (150-day MA; the Slope is a Keystone Cyclical Signal)

·         1394

·         1393.62 (10-month MA)

·         1391

·         1390.22 (200-day MA)

·         1388

·         1385

·         1384.53 (12-month MA; a Keystone Cyclical Signal) (the cliff edge)

·         1384.03 (50-week MA)

·         1380

·         1377

·         1375

·         1373

·         1371(5/2/11 HOD for 2011: 1370.58)(8/16/07 LOD: 1370.60)

·         1370

·         1366

·         1364 (4/29/11 Daily Closing High for 2011: 1363.61)

·         1362

·         1358

·         1357

·         1355

·         1351

·         1348

·         1345

·         1343

·         1341 (7/26/12 Draghi Announces Support for the Euro Starting QE Rally)

·         1338

·         1337

·         1335

·         1333

·         1331

·         1329

·         1326

·         1324

·         1321

·         1319