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Thursday, April 18, 2013

Daily update 4/18

The bulls tried to get the market going on the upside with an overnight push up with the futures, but the bears came out to play right away.  Here is the daily SPX chart.



SPX dropped slightly below the key support at 1538 late in the day, but closed back above it.  It closed slightly below the 50 SMA and the lower channel trend line.  Notice the bias flipped to down today.  The ball is in the bulls court here at key support.  What will they do with it?  A lower close tomorrow would add confirmation on the daily chart of a pullback.  Lets look at the SSO 195 minute chart.


SSO closed below the first support line, but held above the next one.  The last bar closed below the bar that flipped the bias to down adding some more confirmation that a pullback is in progress.

The dip buyers did not show any real desire today.  If they don't come out and support the market here tomorrow it could be a wide range down day.  If we break down everybody that bought since the early March big gap up (circled area on the 195 minute chart) will be underwater.  I think some of them will undoubtedly bail.  I don't see much of anything to go on about tomorrow morning.  The bulls may show up at support or they might not.  We are not over sold enough to give high odds the bulls will show up.  We will have to see if the spirit moves them.  I think there is enough damage that any bounce from this support will be short lived and not make new highs.

Bob

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The information in this blog is provided for educational purposes only and is not to be construed as investment advice.