S&P 500 ($SPX.X) Chart - July 25, 2008

This morning I charted the three year weekly chart for the S&P 500 ($SPX.X) ending Friday, July 25, 2008.  I started off trying to find a bullish trend line I could point out that showed something positive for us to see and went all the way back to the 20 year view before I decided that we all know markets go up over enough time and I should focus on what’s happening in the nearer term.  That’s how I ended up charting the three year S&P 500 again.

Every trend line I drew points down meaning that all previous bullish trends have been broken recently.  We even broke below the June 2006 lows this month.  Now the October 2005 lows are within sight.  The question might be how long before we get down there versus if we’ll get down that low.

To find a positive from the trend lines, I can point out that we are at the bottom half of a trading channel now and could see a move up or at least sideways until we hit the trend line of lower highs.  I’m not counting on too much of an upside swing with the 200 week moving average acting as a potential ceiling not far above 1300.  I didn’t even include the 50 and 100 week averages since they are so far from the SPX’s current price.

Another possible positive is seen within the Williams %R indicator.  We’ve been in the oversold range since mid-June and peaked our head out of it last week.  If the SPX doesn’t take a double dip into it, north could be the likely direction for the index.

Overall I’m still bearish until I can find a trend that can be my friend.  Oil’s retreat helps, but anyone who thinks the $120s gives us reason to be bullish has forgotten how bad it felt when we first got to the $120s a barrel.  Gas at the pump is still high and eating into many consumers’ budgets deeply.