S&P 500 : Tops gradually downward
At the dawn of the next reports of U.S. companies on their business for the second quarter, it should make a technical point on the S&P 500. Recent events on the European Summit is expected to exercise positively influence on american stocks.
With the deterioration in prices since the market top of March, the index is on attractive valuation levels with an average PER at 13.46x against a five-year average close to 16x.
Technically, the Dow Jones index is in technical rebound phase since its V-Bottom made on the 1278 points area. Prices are confronted with different moving averages in daily data. The current situation indicates a degree of neutrality within two pivotal points : the upper limit of 1360 points, the convergent point with the 100-days moving average and the level of bullish reversal at 1278 points.
In weekly data, the trend is bullish. This long-term configuration should help to advance the index towards 1360 points. Nevertheless the index should quickly exceeded this area lest a back pressure of new sellers (identified by three tops gradually downward descendants). However degradation under 1310 points would lead to a fall of the index towards the 1280/1260 points.
![Tops gradually downward](/graf/as31053.gif)
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