Today does not really tell us much. We have a doji candle with kind of long tails on both sides. This is commonly called a Riskshaw man. It is nothing but an indecision pattern and does not foretell much about future direction. With both breadth charts negative the bears have control of the market so the bulls must really prove themselves here. Check out the 195 minute SPY chart.
We can see three tests of the support line in the last two days. Price bars are still red and the 50 SMA is starting to roll over. I don't see anything that indicates we are going to reverse from here yet. Check out the 60 minute SPY chart.
The mid day rally penetrated the 18 SMA, but could not hold it after it failed to take out the morning high. Taking out today's high would be a positive for the bulls and would likely cause some short covering. Until the breadth charts get back to positive crossovers or we get above the 50 SMA I think we stay in sell rally mode.
Keep in mind a break of the daily 50 SMA could cause an acceleration down.
Bob
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