Archived IMT (2010.10.26)

S&P500 1195 Path OF MOST RESISTANCE? There is little reason for the market to drive up the S&P500 above its 200-week MA ahead of Q3 GDP (Friday), mid-term elections (Tuesday) and the FOMC meeting (Wednesday). The S&P500 hasnt closed above its 200-week MA since June 2008. With each of these important events containing downside risks (disappointing GDP, jeopardizing Bush tax cuts for the market & lower QE), expect continued consolidation in the indices despite the fact that the DJIA has already broken above its own 200-week MA for two consecutive weeks. DJIA seen capped at 11,250. US Oct consumer confidence rose to 50.2 (exp 49, prev 48.5) but is failing to prop equities. If market failed to rally on yesterdays 10% jump in rise in Exist Home Sales, how could it rally on this consumer confidence, whose Jobs-hard-to-get index pushed up to 46.1 from 45.8. EURUSD 4-hr chart tests breaks below $1.3890 trendline support from Sep 9, alerting euro longs that $1.3820 & $1.3770 could be the next target in the event that NY closes below 1.3890.