The SP500 has simply done a layup to the last overhead resistance. You can see it clearly on the chart in my SP500Tracker™ out this past Sunday (see link below). When a market simply goes back up to the prior overhead resistance point, which is simply the point beyond which investors are unwilling to buy the index, it is a better place to AVERAGE OUT than to average in. It is a far better practice to wait for the next breakout when you reach a level such as this, JUST BELOW resistance.
CONCLUSION: There is no rush to buy here. Wait for the next breakout. And realize that since investor sentiment is quite high now, any gains you see from YET another breakout may be short lived. In other words, if you buy and have a profit, make sure you KEEP some of it. Don’t give it all back to Mr. Market.
By the way, my SP500 tracking newsletter was out this past Sunday (AND THE CHART IN IT IS STILL RELEVANT) and its FREE, so please subscribe below if you are concerned about where the stock market may go from here:
Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.