SPX update 5/1

It was an interesting day.  We got a big rally on the slightly better then expected ISM data.  However, we ended the day selling off fairly hard.  Take a look at the daily chart of SPX.

We ended the day slightly below the 4/27 high which came at the .786 retrace level.  That could be important, but I don't know yet.  I have added a trend line across the lows for another early warning sign of trouble. 

The breadth on this rally so far has been good.  Check out the chart of the McClellan oscillator

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The last few days have given us the strongest shot of breadth since early Feb.  It would appear that we should have enough strength to at least test the prior high in SPX.  However, that daily SPX chart kind of bothers me.  I will be watching that lower trend line very closely in coming days.  Here is another chart that bothers me a little bit.  Check out the NDX 100.

This index has been the strongest index for months and often leads SPX both up and down.  It has definitely lost its upside momentum and closed well off its high today.

The bottom line is that we are still in a short term up trend, but that move is a bit tenuous looking at the moment.  The 1393 level still looks like the key level for determining possible failure of the rally.

Bob