07/09/09 Baltimore, Maryland “I’m watching for 930 and 950 on the S&P,” says one of our options analysts, Wayne Burritt.
“930 has become the S&P’s resistance level — a sticking point that just won’t give way. Since October, the market has hit 930 numerous times and each time turned right around to the downside.
“But most recently, the market behaved a bit differently. It hit 930, retreated a bit and then made another attempt at the same level. And while it did manage to successfully break through 930, it quickly stalled just a few points higher at 950. Then, numerous attempts at 950 began failing as well. So resistance now sits at the 930-950 range.
“Because of all the failed attempts, the next break above 950 would have to be convincing and long lasting. In other words, it would have to move with significant strength — and in a powerful uptrend — in order to prove itself. Plus, it would have to stay above that level for a few trading days.
“If that were to happen, then my take on the market would be bullish. And if this were a stock, that breakthrough would be an excellent signal to look at buying calls.”
If you’re interested in giving the options trade a shot, definitely check out Wayne’s Easy Money Options. It’s an affordable, easy-to-understand introduction to this highly profitable market, here.
Cheers,
Ian Mathias
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