The S&P 500 cash index (SPX) closed at 1123.53, down 55.25 points or about 4.68% for the week.
SPX weekly chart
Last week the stock market had a brief 3-day rally due to a short-term oversold condition. On Thursday, the market resumed the downside move in response to at least five euro-zone countries demanding collateral from the Greek government to cover their contributions to the $157 billion bailout fund. (Of course of Greece had adequate collateral it would not need the bailout).
France and Germany – and others – also dismissed the notion of new Eurobonds that would establish a common rate for all European government debt. Until they agree unanimously the proposal is certain to fail.
This week we may see one more major sell-off to end the short-term decline before the GDP report on Friday and a speech from Fed chairman Bernanke. The Fed is meeting this week, and will probably issue some sort of statement intended to slow the decline.
To see Nat’s full technical analysis of the SPX this week, visit http://naturus.com and download the weekly preview from the home page.
