There is a bit of confusion in these two charts if you look at them carefully. The 195 chart makes it look like SPY turned back at the down trend line. The 130 chart makes it look like it broke through the line and came back and tried to go below it, but ended up closing about on top of it. So lets break it down just a little more with the 30 min. chart.
We did close right on the trend line. Notice the big volume bar as SPY bounced going into the close. That kind of looks a little bullish there for tomorrow. The bounce may still have a chance, but I think it needs to get going right away in the morning. If we open below that trend line tomorrow, then the longer we stay there the higher the odds are we head back down. We could still go either way here and the news flow tomorrow may be the determining factor.
I want to take a quick peak at the CRB commodity index. Here is the daily chart.
It is really hard to make any kind of bullish case for the global economy with this chart looking like this. Yesterday's rally in stocks did nothing for it. Even if the SPY bounce continues it looks like it could be short lived.
Bob
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