Last week was a hack job and a study in physical and emotion abuse. This week has been a sloppy chopfest and we are about 10 handles away from where the week started. The $SPX has been trading “under” the 10 day moving average for about 10 days now. We tagged the 10 day ma today, and we will probably know tomorrow if it was just a kiss or if she’s staying over. Obviously the bulls need to take the hill and breach that level on a closing basis. We don’t hit the 50 day ma until about 1809.
When (if) things get going though, we could be back at the highs fairly quickly.
Yesterday Tom DeMark said if we didn’t rally within two days, we were heading to 1100. He uses is own measures and counts, but if you look at the weekly chart of the $SPX, he was probably looking at a violation of the uptrend line which goes back to 10/2011. This happened yesterday, but it managed to take the level back on a closing basis, and we did rally today. The red lateral line does take you to 1100.
I couldn’t disagree more with that call, but then again I’m not a market timer like him.
I think this is just a correction. 1700 is still very much in play though, and a lot will depend on the part time jobs number tomorrow.
Last night I said they could rip them today because we held the lows yesterday and bounced, but tomorrow matters more. If the number isn’t a disaster tomorrow, I think they will try and take them up again.
My buy list consists of many biotechs. I still think they have a huge rip left in them, they just need better tape. Just buy them right. l Love $REGN, $CLVS, $GILD and others.
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