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Wednesday, May 11, 2016

Daily update 5/11

About face.

SPY closed below yesterday's low so everybody that piled in and held today is underwater.  The breadth was -63%.  New highs fell off a lot to 139.  New lows picked up some to 24.  That potential head and shoulders pattern is looming large now.  The retail sector had a very tough day.  The consumer isn't coming through.  That was a pretty stiff rejection at the 20 SMA.  This looks like it wants to test the recent low. 

The futures were turned back at the 50 SMA.  The bulls need them to hold the 20 SMA.  Bears want to see a break. 

The red count held steady, but the green count dipped a bit.  The bears have a slight edge.

Today was a big disappointment for the bulls.  Yesterday the rally was on nothing really.  Not much of a surprise it didn't last.  Earnings were the main driver today.  Retail stocks got hammered and DIS was also a problem.  Up on nothing yesterday, down on fundamentals today.  The path of least resistance still looks down to me.  The bulls have one chance tomorrow to salvage the bounce.  Otherwise SPX should be headed for a test of the recent low.

Stanly Druckenmiller gave a presentation at an investor conference the other day telling people to get out of stocks and own gold.  He is a smart guy and a lot of people listen to him.  I saw a report saying Icahn is now majorly short.  I am not the only bear out there afterall.  I like being in the company of smart billionaire investors myself. 


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