SPX Daily Chart - 20 April 2011

     With price reaching towards two important resistance areas we will learn a lot about the strength of this market by seeing how it reacts when reaching them. The first upside target is based on the qualified break of the TD Supply Line (downsloping red dashed line) and lies at about 1337.5 (marked on the chart in brown). The second target area is between 1341.59 and 1345.50 (two horizontal blue lines on the chart).
     Price Pulse. On April 11th I noted that my price pulse work indicated that the 'y' pulse had completed. It is now clear that the 'z' pulse in the sequence finished at the April 18th low. Since the 'z' pulse low was higher than the 'x' pulse low the implication is that we will exceed the April 8 high unless the higher degree pulse turns.
     Bottom Line: The bulls are once again attempting to break above the February 18 high. But, until we get a qualified break of 1341.59, the daily chart remains in bearish mode (which it has since Feb.22). My allocation mix meter remains at +50%.