Pre-market update (updated 8:00am eastern):
- European markets are trading 0.9% higher.
- Asian markets traded in a mixed/flat manner.
- US Markets are slightly higher heading into the open.
Economic reports due out (all times are eastern): Producer Price Index (8:30am), Consumer Sentiment (9:55am)
Technical Outlook (SPX):
- The S&P finished the day well off the lows of yesterday’s action and finished right on the trend-line that began off of the 6/4 lows.
- Bounce here or the market goes into a more extended pullback mode.
- We’ve sold off for the sixth straight day – which is a pretty hard thing to do without a single day in the green. But the selling has not been by no means “panicky”. Just compare, the last time we sold off 6 straight days, was in May, and we dropped 62 points on the S&P. This sell-off has resulted in only a 40 point sell-off.
- Also very interesting during this 6-day sell-off is the fact that the VIX is still under 20 at 18.32.
- 30-minute chart shows a nice downward channel that has now been established.
- Over the last 6-days of selling there has only been one day, where we haven’t seen the dip buyers step in intraday.
- SPX closed just a shade above the 50-day moving average.
- 1374 represents some short-term resistance, and a break & close above that price level would represent another “higher-high” for SPX.
- SPRI indicator is showing a market that is beginning to enter bullish extremes. No reversal though.
- An area of concern for the bulls is the fact that the the rally off of the 6/4 lows is forming a bearish wedge.
- Breaking through the 1390’s will be difficult as there are plenty of separate resistance levels in that area.
- Below 1306-1308 price level, will nullify the current rally off of the 6/4 lows – would represent a ‘lower-low’ in the market.
My Opinions & Trades:
