(Bloomberg) -- The Standard & Poor’s 500 Index may “take a breather” following a six-month rally, according to a technical analyst at UniCredit Markets & Investment Banking who uses volume indicators to predict future movements. The benchmark index for U.S. equities has rebounded 51 percent since March 9 and climbed to a 10-month high at 1,030.98 on Aug. 27 after corporate profits beat analysts’ estimates and reports signaled the economy is improving. “Volume indicators tell us to sell,” Volker Bien, a Munich-based technical analyst at UniCredit SpA’s German unit, said by phone yesterday. “Since March, volumes have been running negatively divergent to prices. These strong negative divergences will take the momentum out in the short term.”
Technical analysts base predictions on price and volume charts. Money-flow analysis gauges whether a stock is likely to rise or fall based on how much is traded at different prices. “Volume indicators pose short-term question marks,” Bien said. “For August this is not unusual but September has to deliver. From a general aspect the market is still relatively constructive.”U.S. stocks may resume their rally if the S&P 500 breaches a resistance level at 1,100, according to Bien. The measure in August closed above UniCredit’s first mid-term targets of 980/1,003, he added.
No comments:
Post a Comment