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Tuesday, May 8, 2012

SPX daily update

Miraculous comeback today.  After breaking the April low early this morning and selling off a couple of hours the bulls showed up.  With the close back above the April low we have what could be a successful test.  Check out the 195 min. chart.

As you can see we got a blue bar on the morning's low indicating price was very extended.  Notice the big rebound, but on much smaller volume.  This setup could make a low, but it also could draw in bulls only to slaughter them later.  Check out the daily chart.

We have a hammer candlestick on the daily chart, but look at the volume.  This is a pretty inconclusive looking chart.  We could easily bounce up to the 18 SMA in the 1383 area.  We have a lot of technical
damage over the last week so any bounce could easily turn out to be of the dead cat variety.  This market will need to prove itself on the upside.


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