With just about 1 hour left in the day, the S&P 500 is currently through the 1050 level, which means if it were to close right now the uptrend line from the March low would be broken. I’m placing emphasis on the close, so let’s see what happens.
The NAZ is through the 2085 level, and has continued much lower since breaking its trend line yesterday from the March low. This is technically significant, and suggests the character of this market may finally be changing.
Many are considering the market to be short-term oversold, and when weighed against the highs of last week, it probably is. The NAZ has given back about 5.4% just from last Friday’s high, so that’s a lot in just a few days. However, oversold (and overbought) conditions can often persist for longer than many expect. Given the breach of the uptrend lines and support levels, I’m going to respect the weakness we’re seeing. It’s been a good day to be short, let’s see how we finish.
Jeff
