S&P500 RSI value is at 76 on the weekly chart and 74 on the Daily chart, implying a SHORT trade should be placed around 1360 (Mar07) and 1370 (Aug07) low prices with a target price of 1220 in March. Last time the S&P500 reached over 70 on the weekly RSI was in mid April 2010. The S&P500 proceeded to fall 17% from 1220 to 1010 over the next 10 weeks. Seasonally, the market dips in Q1 by 9% in a short period of time. e.g.........
2010 - Fell from 1150 on Tues 19 Jan to 1044 in 13 days, a fall of 9%
2009 - Fell from 875 on Mon 9 Feb to 666 in 18 days, a fall of 24%
2008 - Fell from 1388 on Wed 27 Feb to 1257 in just 13 days, a fall of 9%.
2007 - Fell from 1462 on Thursday 22 Feb to 1364 on Wednesday 14th March again over 13 days.
2010 - Fell from 1150 on Tues 19 Jan to 1044 in 13 days, a fall of 9%
2009 - Fell from 875 on Mon 9 Feb to 666 in 18 days, a fall of 24%
2008 - Fell from 1388 on Wed 27 Feb to 1257 in just 13 days, a fall of 9%.
2007 - Fell from 1462 on Thursday 22 Feb to 1364 on Wednesday 14th March again over 13 days.
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