The above chart of the SP500 shows a median line study, also called Andrew's Pitchfork. Marketclub's blog recently had a post on the usefulness of this kind of analysis, so I thought I would check out the SP500 relative to its current median line.
As you can readily see, the SP500 has been travelling along its median line since hitting that level in April. However, the most interesting point is that it is currently below the line. In order for the rally to continue its advance, the SP500 will have to get back above the line, while a strong advance above the June high could propel it to the upper line near 1100. At this point, I do not see a return to the lower line in the near future, although it is a remote possibility.
Once the high of the rally has been seen, we can project the next median line for the fall correction.