Dip buyers are still active. What we don't know is if there are rally chasers. SPX closed marginally positive, but on negative breadth. The volume dropped significantly today. Here is the daily chart.
This is one of those days that makes it look like SPX bounced off the 18 SMA. The low today was 1676 and the 18 SMA now is 1677. However, this morning when we down there the MA was at 1668. Even in charts things are not always as they seem, LOL. What actually happened was the futures tested yesterday's overnight low and it held. The dip buyers then rushed in the rest of the day. It remains to be seen whether they were smart or bag holders. We are still within the range of the key reversal day. The new lows dropped down to 43, but new highs also dropped down to 107 from 153. If new highs drop under 100 then the odds greatly shift to the bears. Lets take a look at the SPY 60 minute chart.
The SPY chart shows a lot of big green volume bars (accumulation) after the June low until 7/19. Since then there are more big red volume bars indicating distribution. The first two volume bars today dwarfed the last two from yesterday that I commented on as being good volume. Until this shifts back to accumulation the market is suspect. Be careful. SPX still needs to clear 1700.
The daily 18 SMA is rising fast and will either slap the market higher or SPX will break it and start the correction. The bulls need a thrust up to show that people are willing to chase price and not just buy the dip.
The bears need a close below today's low. Which will happen first?
Chart practice has been updated with MNST the stock tonight.
http://traderbob58-chart-practice.blogspot.com/
Bob
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