S&P in Euros

The S&P is trading very nicely at support of January-March lows to the extent we will probably look back and say what a great buying opportunity it proved to be. If it doesn't play out as such at least it is relatively easy to define the risk involved (a break of the 2-day lows is reason enough to jump ship):


The Dow is there to spoil the party given it sliced through similar support and is leading the other averages lower:


One other avenue of support is the relationship between the S&P and the Euro. The index priced in Euros is once again trading at support from January (much as the dollar-priced index), but also lows of 2003 when the cyclical bull market kicked off in the U.S. If it wasn't for the global slump the relationship would suggest excellent value for foreign investors in U.S. markets (and a chance to build a bottom). As it stands it is more a 'wait-and-see' indicator which suggests a bottom, but this bottom may not come to a fruition as it had in the past.

Get the Fallond Newsletter

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, market alerts and stock charts website