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Tuesday, May 28, 2013

Daily update 5/28

In Daily update 5/24  I wrote

"I think the drop in new highs is a sign we have entered a correction.  However, I want to see some actual selling before I can say that is the case.  Other then the key reversal day all the intraday action has been to the upside.  This does not mean there won't be sellers if they get strength to sell into, but until it happens we won't know."

Today we got selling into strength.  Here is the daily SPX chart.

SPX tested the area of the recent highs this morning.  It found its high early in the day and worked lower throughout the afternoon.  Tuesday was up for the 20th time in a row.  I have seen this all over the place now.  You have to wonder how many more times that can happen.  This looks like a possible failed retest of the high.  If the market rolls over from here there should be considerably more selling this time.  It looks like we have clear resistance in the 1674 area as price has been unable to stay up there.  The daily chart looked like it was forming a top to me before the key reversal day.  I don't see anything that has happened since to change my view.  It looks even more like a top now.  I guess we will see what happens next.


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