Technical Analysis : S&P 500 Index Due for ‘Stiff Correction’

(Bloomberg) -- The U.S. Standard & Poor’s 500 Index may be due for a “stiff” slump as it approaches a resistance level in coming weeks, according to Nader Naeimi, a strategist at AMP Capital Markets, which holds assets worth $75 billion. The U.S. index’s 62 percent rally from its March low has brought it close to 1,121.4, which Naeimi says represents the 50 percent level Fibonacci analysts identify as a key resistance point. The performance of the index, which closed at 1,096.56 yesterday, is also diverging from measures of price and breadth momentum, pointing to a deeper “correction” than those that have occurred since the rally began, the strategist said.

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