P.S. 4:15PM EST: SPX closed just below the 1855 support I mentioned. If SPX gaps down tomorrow, not only is 1840ish a likely first target but the market behavior will have potentially changed after 4 consecutive days of opening buying and the technicals will be aligned even more bearish. There is still an argument for an SPX triangle and Dow/Naz B wave for the last 3 weeks with an upside breakout imminent but that will be dashed if SPX breaks down tomorrow and the dam could break open with key moving averages at 1835-1865 becoming resistance on any subsequent sizable bounce. Tomorrow could be the decisive day one way or the other or perhaps overnight Sunday. BTW, I put my money where my mouth is after the close yesterday and at the open today, but I'm playing for a 5%+ move. 1876 is a good stop currently for shorts.
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Moving averages are a part of my System with the 20dSMA being a key one. The 20dSMA for SPX is currently at 1865 where SPX is hovering. Dropping below that adds to the bearish case. 1855 and 1834 are other important moving average levels and 1862 is a 4hr candle level. So, my educated guess is that closing below the 20dSMA should lead to a retest of 1840 with 1855 perhaps being the last support line in between. If SPX closes below 1834-1840, a significant downtrend has likely found its stride and could test support areas at 1730-1780 within a week or so. There's the potential for a 4-7% drop in 5-9 trading days. Good fortune.
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