Fibonacci Retracement Levels in S&P 500 Index

If you draw a Fibonacci Retracement level from its recent high (@1,220) to recent low (@1,040), you can see why the market has not gone past 1,110 level. 1,110 marks the 38.2%
retracement level and it has already reached three times, the last one being June 14. As long as it does not break this level, the market will continue to test its recent low at 1,040.

It would be wise to be out of market for longs mainly because we have no idea which direction it will break. However, keep in mind that if S&P 500 index breaks $1,110, then we should quickly buy some stocks to ride the positive momentum. The next resistance would be at 1,130 because of its 50% retracement. The 61.8% is at 1,150 so S&P 500 index could possibly reach this level as well. Keep track of these critical levels as you watch the stock market closely.