Nothing goes in a straight line, up or down. Earlier this week, I said the major stock indices could be due for a rally. Boom — we got one yesterday. It may fall apart today. But if we get a rally, how high could it go?
Remember, until proven otherwise, this is a rally in a bear market. And that brings me to my chart …
As you can see, if the S&P 500 could rally, simple retracement targets give us a range beetween 847 and 927. 847 lines up nicely with the 50-day moving average (which is actually a bit lower). So that may be firm overhead resistance.
Of course, the market has to put a rally together first. We’ll see how the day works out.
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