S&P 500 Morning Analysis 8/11/09

The SPY continues to hold up well as it closed above the most relevant trendline (also represented by the 10 day moving average shown in blue). This morning we will be watching to see if yesterday’s high ~ 101.22 will be breached or if a short term lower high is made. If a lower high is made and then the SPY drops down through 100 it could be setting up for a corrective phase. The trend is still higher though so short sales should still be kept to the shorter term timeframes. Levels mentioned yesterday (99.40, 98.50 and 96.70) will become potential support areas if the market does break lower.