After a breakout from a chart pattern, price rises then falters and returns to the launch price. This curling price behavior is called a throwback if it occurs within a month of the breakout. Currently we are in a throwback from the multi-head & shoulder pattern. The gap window from the previous downtrend should serve as heavy resistance. This chart has three multi heads with three rise and falls before an end of the year rally.
Chart possibly suggesting a business favorable fiscal cliff deal closet to the end of the year, along with positive action at the Dec. 11-12 meeting. Meeting could conclude a 6-12 month continuation of the Twist program or something new.
Rumors have been suggested that Operation Torque could be in play. Torque is a new program the Fed could undertake which includes introducing 40 to 50 year bonds.
If nothing new is added by the or Operation Twist is not extended, the market will take a further slump. SPY could be priced as low as 133. With no action from the and if the Fiscal Cliff is allowed to fall of the "cliff" into 2013, the S&P or SPY would challange the June lows or even 2011 lows.