SPX tested below yesterday's low, but bounced back. Volume dropped considerably. There was a 41 point drop to the low from the early morning high. The low volume indicates it did not take a lot of selling pressure to make that happen. That is consistent with a bear market where buyers can get scarce at times. Breadth was slightly negative. New highs increased to 24. New lows dropped a bit to 19.
The futures closed just above the 20 SMA. They traded above the 200 SMA this morning, but were unable to stay there.
The short term bull pressure lines show that internal strength peaked about two weeks ago. The long term lines remain negative. The market still has some work to do if the bulls want to get control back.
Sellers have emerged over the last two days. So far there have been enough dip buyers to keep the market from breaking down. The resistance here could be quite significant so there is no guarantee we won't run out of buyers before we run out of sellers. The rally has not broke yet, but it is not clear that it won't in the next several days. The bears need to see SPX close below the 50 DMA.
Bob
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