Today's low so far was 1173.60 which if you look back in time is approximately where the rebound after the flash crash failed. This level also was just below the 50 MA meaning we have pierced it. Piercing a trendline is an early warning of a trend line break. This isn't to say we can bounce up for a week or so. However, closes below the 50 MA should be viewed as extremely bearish as there is little support under the market. Next stop 1140 where the 200 MA is then I would think 1040 is a likely target for a test. If the market gets above the 20 MA and holds then maybe start looking for long positions, I stress maybe as eurozone and all of the instability with Korea is not a positive for the markets.
Also note today is the first double POMO day which apparently doesn't work the way the FED had hoped as geopolitical instability trumps bond purchases. VIX is up past the 23 level and dollar is in a strong up trend both a negative for the overall markets.
UPDATE: close
I used the SPY here to demonstrate the volume on a 5 minute chart.
Like the past few weeks, a common volume trend is strong sell volume...
Looking at the magical rise of prices exactly as the clock hits 2:30, the volume is telling....
At the end of the day, the buyers have cashed out. Leaving whoever chased holding the hot potato.
Like Nov 22nd, I expect a gap down to start the day.
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