$SPX Update for 09.21.2008

S&P 500 INDEX - $SPX

Monthly chart shows regular divergence developing with the lower low made this month. Bottoming tails indicate aggressive buying, where the bulls managed to regain most of the ground that was initially lost this month. Index remains below both the 8ema and the 34ema. The bulls managed to close the index right at the March 2008 low. No buy signal/pattern evident on this timeframe as of yet.

Weekly index shows a long legged doji being created with last week's trading activity, indicating indecision between the bulls and the bears. No buy signal/pattern evident on this timeframe yet. Look to next week for better sense of direction.

Daily chart shows that the consolidation/trading range finally broke down to a lower low, where aggressive bulls found support off the 1.618 fib area. This pattern created a bullish butterfly pattern, where bulls came out in force after the bailout of AIG and the temporary banning of short selling of 799 financial stocks. Look to next week's trading activity for better sense of longer term trend.