&P 500 SPDRS (NYSE:SPY) ETF

The S&P 500, as represented by the S&P 500 SPDRS (NYSE:SPY) ETF, respected the $104 level as support, making this a critical level to watch. The significance of this level is that it held above the July lows, showing that investors were willing to pay higher prices than they were a couple of months ago. This could be an important intermediate low, and would be confirmed with a break above resistance near the $113 level. Many bullish traders will now turn their attention to the nearby 200-day moving average because this could act as a strong area of resistance and reveal some cracks in the recent rally. Despite the show of strength by the bulls, SPY may still need time before mounting a serious assault to clear the $113 level. The markets are already extended in the near term, and are pressing into gap resistance near $112.