Well I guess Benny said something today that the market didn't like. Honestly, I try not to listen to the news and the gibberish that comes with it. News influences people. I guess this is why we have insider trading rules and regulations and the SEC to uphold these rules. I wonder if they ever got around to talking to those Bear Sterns put holders that made off with $270 million just days after it collapsed back in March 2008. I guess they were just lucky. This rant of mine is neither here nor there regarding today's market analysis but I'm sure it will manifests itself once again in future posts.
The traditional daily PnF chart below shows that 1640 is an area of important support and resistance. Significant areas of support and resistance will lead to significant price moves if broken. Otherwise the would not be considered significant. Duh!
The 60 minute PnF chart shows a more refined area of support and resistance at 1643. Refined means less margin of error. If the 1643 level seems familiar it should as we spoke about this level here. The nice thing about significant areas of support and resistance is that they don't change frequently but need to be tweaked occasionally for volatility.
The 5 min SPX chart below shows how price reacted around the 1643 area (red circles). Yesterday when price broke above this area, price continued higher until it hit minor resistance at 1652.1 (Shown below). Today the SPX fell back to 1643 acting as support shortly after Benny's talk and continued to see much activity until it broke lower. Price then dropped quickly as one would expect at a significant level of support and resistance.
15 min PnF chart with 1652.1 as minor resistance.
Thanks for reading