Somebody sold into the gap up right after the open. That sent SPX down below yesterday's low. The selling stopped and the dip buyers went to work. That is how it went all day with the buyers and sellers taking turns. SPX spent a considerable amount of time below yesterday's low, but failed to break down. That is a positive at least for now.
For the last two days the futures have run into heavy resistance around 2446. They have also found support around the 200 EMA. At the end of the day the futures were still below the 200 SMA. However, they moved up immediately after the close to climb back above the 200. The bounce scenario is still alive.
The counts did not change much.
The last two days have seen enough dip buyers to absorb the selling volume. This might embolden more bulls to step in and do some buying. A gap up tomorrow might have a different market reaction then today. The usual way the bulls solve a resistance problem is to push the futures well above resistance overnight. The way the futures jumped up after the 4 PM close that might be what the plan is. On the flip side we need to watch today's low (2436) should the market test down there again. After two days of dip buying a market break down will bring out a lot more sellers.
Bob
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