Yesterday, we looked at the S&P 500's strength level. Today, we will look at one of the S&P's resistance levels.
There are many ways to determine resistance levels. When you have multiple resistance levels, there are always one or two very "significant" resistance levels.
One of my favorite resistance levels to watch are long term, fan line resistances.
The reason is that they are often major break through levels. It is not untypical for a stock or index to "gap up" over a fan line resistance level, or to have a sharp jump the day it rises above it.
On today's chart, I drew 2007 to 2010 fan line for the S&P. The fan line's resistance level for today is 1135. Because the fan line is down sloping, the resistance level will decrease as time moves on.
