By: Scott Redler
What the hell does RedDog mean by this (in the spirit of the Super Bowl this weekend)? When the S&P broke 1,130, the market turned into the Bear’s playground–the complexion changed and they had room to play. The area of support for the battleground was isolated to be the 1,083-1,085 zone. In that zone they had to battle rather than play–meaning, the Bears had to fight to try and get this market down more than the 5-6% we already had retreated off of the highs. It was up to the Bulls to take back the ball.
Now, in my opinion, the Bulls have the ball. I feel like there is still more room to run, so the Bears will now have to play some defense. Yesterday, the Bulls picked up a big first down, but they still have some room to control the game. The Bears will have to step up and prevent the Bulls from scoring a big play. The first down marker for the Bulls now checks in at around 1,092 on the S&P. If they can retake that area, they can then move the ball into field goal range in the 1,098-1,102 area.
THE BEARS MUST HOLD THE BULLS in the 1,108-1,112 range, or they are in jeopardy of losing the game. In other words, we have room to work off this oversold territory, but you Bears out there better play some big time J E T S defense when we retest bigger resistance–resistance which generally speaking has not held the Bulls once since the March bottom (we never saw more than a 5-6% correction other than in July). If the Bulls cannot pick up that next first down, the Bears must smell some blood and attack.
Still, the action remains very stock and sector specific. Here are a few key charts to simplify the recent action.
First the S&P:
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Now Goldman Sachs (GS), the leader of the financials:
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And lastly, U.S. Steel (X), a good indicator of action in the metals and commodities:
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