S&P 500 and Nasdaq 100 correction

By Colin Twiggs
May 15th, 2012 1:00 a.m. ET (5:00 p.m. AET)

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The S&P 500 broke support at 1340 to confirm the correction. Initial target is 1300. Reversal of 21-day Twiggs Money Flow below zero confirms medium-term selling pressure signaled by an earlier bearish divergence . Recovery above 1360 is most unlikely but would warn of a bear trap.

S&P 500

* Target calculation: 1350 - ( 1400 - 1350 ) = 1300

A similar 21-day Twiggs Money Flow signal on the Nasdaq 100 warns of medium-term selling pressure. Retracement respected resistance at 2630, confirming a correction. Initial target is 2500*.

Nasdaq 100

* Target calculation: 2630 - ( 2760 - 2630 ) = 2500



The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.

~ Vladimir Ilyich Lenin

Colin Twiggs

Author: Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters.

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.

He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.