US: S&P 500 correction
By Colin Twiggs
October 23rd, 2012 10:30 p.m. ET (12:30 p.m. AET)
The S&P 500 broke support at 1420, following a trend channel breakout, both signaling a correction. Reversal of 21-day Twiggs Money Flow below zero warns of renewed (medium-term) selling pressure — a peak below zero would strengthen the signal. Breach of 1400 would further strengthen the signal.
The Dow Jones Industrial Average similarly broke support at 13300 on the weekly chart. Bearish divergence on 63-day Twiggs Momentum indicates a weakening up-trend; reversal below zero would warn of a primary down-trend. Breach of support at 13000 — and the primary trendline — would warn that a top is forming. Recovery above 13650 is unlikely at present but would indicate an advance.
* Target calculation: 13000 + ( 13000 - 12000 ) = 14000
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