SPX closed about 20 points below its opening price. The bulls pushed SPX above yesterday's high and it held up there until the 2 PM sellers showed up. They went to work all the way to the close. Breadth was +63%. New highs were stable at 34. New lows dropped way down to 122. The bulls are trying, but the sellers have not relented yet.
The futures ran up to the 50 SMA, but turned down hard. That leaves us with a white bar after one green bar. Since the early Oct. high there have been 5 rallies that had green price bars. Four of those rallies were over on the first white bar. The while bar on Nov. 2 is the only one that did not kill the rally. That instance had green price bars on the daily chart showing some upside momentum that we do not have now. Will tomorrow go against the odds or will the sellers show up again?
The red count slipped a bit more, but remains above 50.
The bulls have been trying to get a bottom in by pushing the futures up overnight. However, the sellers keep showing up to spoil the party. Dec. is an odd month in that often the direction of the last two weeks is the opposite of the first two weeks. Obviously the first two weeks have not been kind to bulls. If the usual pattern is to repeat we should see the end of the selling around the end of this week. I feel bad for money managers with the current news flow. Up and down, up and down. It is a tough time unless you are a day trader or very nimble. If that is not you there is no law that says you must trade. When the market is not favorable to your trading style it is ok to sit on your hands.
Bob
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