I like to track big whole numbers on the equity indexes. I think of the Dow Jones Industrial Average in 500 point increments. The NASDAQ 100 in 200 point increments and the S&P 500 in 100 point increments.
Often rallies can start or stop at these levels. Currently, we are stuck at 4400 on the S&P 500 and 440 on SPY. There have been 9 moves above and below 4400 that have occurred in two months (July and August). The longer it takes to clear 4400 the greater the likelihood we head lower.
The longest breakthrough this year was 3800 that took three months (January, February and March) and 14 tries to clear 3800 on the S&P 500.
The classic breakthrough was 4000 that took one try and never looked back. That is what I call “The Jim Morrison Trade” - breaking through to the other side.