Despite Sell-off, S&P Says to Stay Long
by Sam Collins 02/11/09
S&P 500 Index (SPX) -- After the Feb. 10 sell-off, the "500" is sitting just above the 800 to 820 support zone.
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The market turned away from the resistance at the 30- and 50-day moving averages for the second time in a month, and this is not a favorable sign.
The stochastic appears to have given a sell signal but even that does not predict that the support at 800 to 820 will fail to hold. And so, despite the emotional reaction to the U.S. Treasury Dept.'s plan, we will stay long and cautiously add to oversold positions.
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Sam Collins is a registered, fee-based portfolio manager who may be contacted samailc@cox.net. You can also check out an archive of some of his most recent market outlooks by clicking here.
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