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Tuesday, October 19, 2010

After the Close, updates!!!

A bearish cross of the 9 day MA's on up/down volume is close at hand. One other bearish sign is that the 5 day MA on breadth has went negative.
No doubt about it, this IS the chart of the day, The Dollar was on a tear today, and its impact was felt thru the whole market as commodities got hammered with Oil down $3.56, and Gold down $38.50. Signs are very good that the Dollar has put in a bottom of some sorts, with some really nice looking bullish indicators. If the Dollar did bottom, the SPX along with commodities are going to be hit hard to the downside.

USO, also took a beating today, down 4.58%, here is a chart with USO overlaid with the SPX, if USO is leading, the SPX could be down hard this week.

It has been awhile since I have posted the daily Fib fans, but there was not much happening on them to make it worthy is sharing. Today the SPX did cleanly break below the set of fans from the 1010 low (dark green), but are still encased in the shorter-term gray bullish fans. A break below the 1150 level would free the SPX from the shorter-term bullish fans.

The daily chart of the SPX has a few new bearish signs, including broken trendlines on the RSI's, and a negative reading on the MACD histo-gram, which is a sign that the MACD did cross, and is now showing its sell signal. There is some very strong support in the 1120 area, with the 200 day MA, the 50 day MA, as well as the lower Bollinger band. But first the SPX needs to break the 20 day MA at 1156.23.

The bears had a good day, with some strong market internals to go with the sell-off. Including the highest breadth readings, bullish or bearish since September 1st at 4.74:1, decliners at the close on heavy volume, 1.27B on the NYSE of which 88.90% was from "Sell" volume. The Dollar also had an extremely good day today, and Gold got hammered lower.
The SPX finally made a lower low putting the up-trend in severe jeopardy and broke down and out of the channel, but still needs more follow-thru to confirm a new down trend is in place. A break below 1155.41 would accomplish that. The next level of support is from the 20 day MA at 1156.23 before the low can be tested.
The move down today can be counted as a five wave move down, that finished near the close in a bullish wedge. That opens the door for a run up tomorrow for the 2nd wave up.
The Trend Finder also went 25% bearish this morning.

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