Inverse Head and Shoulder formation

The downtrend since April 2010 for the major indices was broken when the August high was breached.
The major indices look like they are forming a Inverse Head and Shoulder formation with the current price already broken its neckline.

SPY (5 Oct 2010)

SPY, the ETF for S&P500 also has similar Inverse Head and Shoulder formation. If the formation continues its form, the SPY and the major indices are on the way up. Baring extreme negative conditions, it is likely to be so. As a Head and Shoulder formation has a measured move, the target price is around $125 ($9 to go). Be mindful that the U.S. mid-term election is going to be held in November. The market is likely to be going up till the election as it expects the Democrats to be denied of the majority. Thereafter, we shall see.

In Singapore, there will be a general election by Feb 2012. The market in Singapore is also expected to be up until the general election. Though the electoral boundaries are not finalised, it can be done one day before the nomination day. As for the possible election dates, it could be:

• As soon the primary school year-end exams are over (as new primary schools a now rather large, the elections dept need not use Secondary Schools & Junior Colleges for Voting & Counting venues) but after the mourning period (if there is any) is over for PM's family over the death of MM Lee's wife
• Soon after the GCE 'O' and A' level exams
• Anytime in Jan to Feb 2011

Cheers !

PersianCat