SPX dipped slightly below 2800 and bounced. The bounce was not particularly strong and SPX slid back down toward the close. However, it remained above 2800. That makes 10 days in a row now and we have a whopping 2.6 points to show for it. Nothing to write home about for the bulls. The breadth was -52%. Not all that bad. The damage is being done by big cap stocks taking the indexes down. Some money is flowing into other sectors. XLF was slightly positive. New highs dropped down to 44 while new lows were stable at 37.
The futures dipped down to the lower channel line for the first time since the last important bottom. They closed just a bit above the 50 SMA. We have a confirmed break of the 20 SMA. The bears are threatening to take control, but a bounce from here would be normal.
The lines have come together after another brief trip above 50 for the green count. The SPX break out above 2800 never showed any strength.
It looks like earnings season is not going to be good enough to propel SPX to new highs and beyond. The market usually has some weakness in Aug. and Sept. of mid term election years. I think the odds are pretty good 2800 is not going to hold for too much longer. A late summer pullback looks inevitable. AAPL reports after the bell tomorrow and the FED meets on Wed. After two big down days in tech that could be a recipe for a bounce. The futures are also in position to bounce so an up day tomorrow would not be a surprise. The bulls need to show some significant enthusiasm at this point to keep the rally going though.
Bob
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