Did the S&P 500 send a “Kiss Good-Bye” message at the close of last month? We should find out very soon!
The chart looks at the S&P 500 on a monthly basis over the past 18-years. Since the 2009 lows, the S&P has remained above an important rising support line.
Late last year the S&P broke below this 10-year rising support line. The rally off the lows around Christmas brought the S&P to the underside of two resistance lines at the close of July at (1).
It remains possible that the S&P created a bearish reversal pattern at the July close, as it was kissing the underside of these resistance lines.
The softness in early August now has the S&P 500 testing 8-month rising support at (2).
Keep in mind this, support is support until broken. If support would break at (2), it would increase the importance of the kiss of resistance last month at (1).
How the S&P handles this support test over the next few weeks will determine if last months kiss of resistance was important.