This is the Capital Essence

on 2011 年 5 月 24 日 (周二) market technical analysis.

We mentioned in Monday’s Market Outlook: “The recent trend of view, the S & P 500 index can be called a trend along the lower channel to 1310 points. But not only the flow of funds indicators remain positive, and the momentum indicator still up, which means that the downside risk should be limited. “we expected the euro zone and the debt crisis of Europe and Asia signs of economic slowdown triggered by the stock market sell-off, U.S. stocks sharply lower Monday morning. S & P 500 index fell 13.12 points, only later after the index admission was the buyer from the intraday lows. The day the market index fell nearly 16 points to close at 1317 points, or 1.19%. Dow Jones Industrial Average fell 131 points to close at 12,381 points, down 1.05%. The Nasdaq composite index fell 44 points to close at 2759 points, or 1.28%. Is widely regarded as the best measure of market panic in the CBOE Volatility Index rose 4.8% to close at 18.27 points.

Strikingly, Vertex Pharmaceuticals Inc (VRTX) bucked the market trend to rise above the daily average turnover of 1.47%, to close at $ 55.81. From a technical perspective, this is bullish. Fact is shown below, after the end of the downtrend, VRTX can stand on the $ 64 and test the 61.8% Fibonacci line. As we all know, since our earliest in the March 23, 2011 of the “swing traders bulletin board” to make recommendations since, VRTX has surged more than 20%, and the form is still good.

The figure comes from our “map of the U.S. market ETF trading,” which shows the S & P 500 Index VRTX recent technical form. As shown, the green histogram that the market price of short-term bullish trend, short-term market trend bearish red, yellow, short-term trend is that the market level. In addition light blue ribbon that short-term trading range. Break up the range is considered overbought (red shading), down below that range is oversold (dark green with below).

Figure 1.1 Vertex Pharmaceuticals Inc (daily chart)

VRTX year from the daily chart can be seen in early December 2010 after the mid-bottom, the stock will go to the full upward trend channel, forming a series of “higher highs and higher lows . ” In April of large upside resistance at $ 59 below face after, VRTX few weeks has been lower in the short-term correction mode.

VRTX breakthrough on Monday cleared early May downtrend line resistance, indicating that the stock has been transferred to a rising trend. Field reversal from oversold momentum indicators rise, allowing prices further on the probe. This phenomenon increased the VRTX to $ 58.87 range near the top of the possibility of rapidly rising resistance. The location is a significant price resistance, close to break through this position can trigger large-scale short-covering market, is expected to be pulled straight to the $ 64.70 price near the next resistance level, which VRTX crash in the 2000 to 2004 Quotes 61.8% Fibonacci line.

But Buyer Tips, VRTX down after the recent indicators have turned negative capital flows, so the upside of the current stage we should not be too heavy positions. The support is U.S. dollars between ,52.21-54 there is a strong support band, which is 50% Fibonacci line with the figure shown in white lines moving average location. Only a close below that level will undermine the recent bullish trend.

Figure 1.2 S & P 500 Index (daily)

As shown above, Standard & Poor’s on Monday near the 1310 downlink test of short-term downward trend channel along the support. The location and the current point in 1295 the bottom of the short-term trading range generally coincide. Short-term momentum indicators from the areas near overbought reversal lower, which means short-term market is unlikely to fall further. Indicator of capital flows, although lower, but still positive, meaning that short-term bulls still have the edge.

1300-1295 there are significant between the support points, this range is difficult to quickly broken. Index will therefore revised up from that position is not surprising. On the other hand, close below that would undermine the “higher highs and higher lows,” the bullish trend on the March low of 1249 points in the test will follow.

,1334-1340 The point of resistance is a strong resistance zone, which is the moving average line with the downward trend in April along the composition range. Although now seemingly impossible, but closed 1340 points will break up short-term trend reversal is likely to further test the bull market high of 1370 points.

Summary: Recent technical indicators from our point of view, the recent S & P 500 Index may be finishing in the 1295-1300 points. Not only the area around 1300 is a major support and difficult to break quickly, but still beneficial to the overall technical, therefore the S & P revised up from that position is not surprising, we recommend waiting for a callback to bargain hunting.

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