SPX hit our overnight support level of 2730 (2732) from the previous update before bouncing. This is an important zone as now the market has to decide whether the uptrend from February 9th will hold or breakdown.
There seems to be some issue with my webhost this morning slowing down updates and preventing image uploads. Hopefully it resolves soon. I wanted to have some stuff posted before market.
For now, the trading range I’m looking at is from 2736 to 2762 (yes, a 30pt range) which would indicate either a slow rise or some volatility on the horizon.
The lower number is most important. If we can’t hold above that, then we may see the current momentum (modestly bearish) continue and break that all important recovery trend. That could very quickly lead to 20-40pts to the downside. The current trend, is still bullish (but choppy/negative near-term) as long as the price remains above the trend support from Feb 9th.
Update 1136: As I said above, if 2736 broke, look for a very quick drop. Bulls are holding at ma support levels right now but momentum and overall price action is bearish. This is one of the last few places the bulls can attempt to save things and recover the uptrend. If not, further lows are on-deck. This is a good area for assessing your risk. I will probably take some profits here in a few minutes if price action doesn’t indicate further weakening.
Updates will be few, still having troubles with my hosting provider and still unable to upload images…
Update 1200: Pretty solid sell-off thus far. I’ve been watching 5minute momentum and technicals for signs of a bottom. None yet, though bulls have tried (unsuccessfully) to form support levels 3 times already.
Update 1315: 2700 has a potential to be the bottom of this downturn. for now though, despite a very slight 5m bump, overall momentum is solidly bearish.
Update 1345: Looks like 2700 may hold as I stated above. We hit the 40pt decline that I mentioned in the beginning of the posting so this is as good a time as any to secure profits. While there can be a case made for 2695 and below, greed is where you lose your gains. For the first time today, 5m Momentum is building Bullishly. It has a long way to turn the near-term trend bullish.
Over the longer-term, if the bulls don’t form a solid support level then we’re on track to revisit the February lows..
I’ll post something with pictures as soon as my provider get’s off their behind and fixes this massive latency issue…
Final Update of the day 1544: Bulls look to be stabilizing the price somewhat but there’s still a long way to go. My near-term cyclic indicator points to a Chop zone which started at 1400 and is continuing until now.
While this may turn into an ending diagonal (pointing downward), it’s rather unclear at the moment and the fact that we’re in a chop zone means that it’ll be even trickier to anticipate. If bulls can hold above 2710, they may be able to springboard up 10+ pts. Failure of this 5 minute uptrend would point towards 2700 and 2695.