In focus: Bulls trying to retain control

By Lawrence G. McMillan

The stock market, as measured by the Standard & Poor’s 500 Index  wound down into an extremely tight range this week.

Those who need a reason for every market movement are saying it’s because the market is anxiously awaiting Bernanke’s speech at the Jackson Hole Summit later this week. Personally, I think it has at least as much to do with the fact that this is a pre-Holiday week, and therefore traditionally a light-volume, low-volatility week of trading. Most of our indicators are little changed this week, and therefore our bullish stance remains unchanged.

Late last week, SPX staged a strong rally, thereby reversing the only modest correction that has arisen in the past month. However, the mid-month highs still stand as the upside resistance area (1,425). SPX is well within the bullish channel that has contained prices since early June. As long as it remains within that channel, the bullish case should not be abandoned. There is support at 1,400 (last week’s low), and at 1,390 (the late July highs), and at 1,370-80 (the lower band of the bullish channel)...

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