Cobra's Market View Private Messaging System shows:
Expect SPX 878 to be tested.
Expect a short-term rebound.
|Trend||Momentum||Comments - Sample for using the trend table.|
|Long-term||Down||Idea for trading intermediate-term under primary down trend.|
The significance of the today’s drop is the very fist time since the March rally a lower higher and lower low is formed. So bears finally see some hopes that odds are higher now an intermediate-term down trend is forming. Well, officially as long as SPX 878 holds, the intermediate-term down trend is not confirmed.
There’re 3 reasons, I believe at least SPX 878 will be tested soon.
1. Russell 3000 Dominant Price-Volume Relationships: 1820 stocks price down volume down, this means that the market is not oversold yet.
2. According to Measured Move, the SPX text book target is right at 874.
3. 2.4.2 NYSE - Issues Advancing, in a down swing, if NYADV forms a lower low, it usually means that SPX will have a lower close ahead.
I have no idea if SPX 878 would hold on the test or not. I’ll pay close attention to 1.0.1 Institutional Index (Daily). Because the support (thick red and green line) on the Institutional Index is more important than that of SPX 878 (thick blue line), as that support was also an important support in Dec last year while SPX 878 is only the support for this year. So if the Institutional Index couldn’t hold its support, then very likely SPX 878 would be broken. Well, let's watch this line closely.
Short-term as mentioned in the after bell Quick Summary, I expect a rebound tomorrow. More specifically, because TICK closed bellow -1,000, so according to 7.0.3 Extreme TICK Readings Watch, 100% (Well, nothing can be 100%) tomorrow SPX will close higher than the open (intraday reversal), and the chances of finally closing in green are also very good.