The market that is making Bulltards cry...
Close: 696
Support: 696, 674, 644
Resistance: 717, 740, 780
SP500 closed today right on the pivot point of 696. Here we are fast approaching the 674 target as shown in "The Good, the Bad and the Ugly". While I do not think this will be the bottom (obvious in note underneath the graph in link), I do think 644-674 could likely prove to be a tradeable bottom provding something/someone doesn't blow up in the next few weeks. However, I would in no way count this as money in the bank because it sure seems forced selling is among us. But at some point all the value investors, who are merely looking to get within 10% of what they think is a major bottom, will start dipping their toes in.
The QQQQ (which I'm still short), needs to get back above 26.86 or else additional selling pressure will come. Aapl seems to have put in some bearish plots today, so I'm keeping a close eye out there. I have a feeling the Q's might double-bottom when the SPY reaches it's 644-674 targets. Just a hunch and perhaps wishful thinking coming from a bear.
In order for this to happen the following needs to happen:
1) Cramer to become bearish.
2) Capitulation by cramerica
3) Market stop falling
4) Clear 740 with follow-through.
Otherwise, sell strength if unable to break above 740. Caution overplaying your hand on the short side right at this instance. In the daily and weekly time frames we are oversold, and a move down to the target area few days would likely put us oversold in the hourly. These hat tricks usually make for a nice rally. Also it's worth pointing out that the NYSE Cumlative TICK is as oversold as it was October when the market ran from 740 to 1000. Another positive takeaway is momentum has continued to make higher lows on the daily timeframe when compared to Oct, Nov and today. A massive rally from here would likely encounter 740, 850 and 960 for the "major resistance" levels. Of course we don't want to get ahead of ourselves just yet considering the market is still falling ;-)
Any bad surprises handed to the market and all bets are off...This is still a bear market and it seems each day we are being greeted with a new piece of bad news. Just one Euro blowup from a lock limit down.
Good Trading
