Will the wedge finally break?

Stocks got off to a slow start on Thursday but some late buying helped the indices close well off their lows.  The Dow, which had been down 170-points earlier, close down "just" 94. 

The TSP stock funds slipped 1.3% to 1.9% on the day, while the F-fund was up slightly.

I may be taking a little liberty with the chart of the S&P 500 because, as you may have noticed, I have continued to use the original wedge as the trading channel, rather than incorporating the low made on November 2.  The reason is because that area seems to be acting as support / resistance, even after the initial break below it, and yesterday was the first time the S&P has gone below it since finding its way back into the wedge a couple of weeks ago.  And, it closed just below it.


                  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

Depending on what happens in the coming days - whether it moves back into the wedge or not - I will likely make an adjustment.  But for now, I see another breakdown with the 50-day EMA as the next level of support.

This is an options expiration Friday and surprisingly, they are not quite as volatile as you might think, although there are exception, of course.  I will be a little surprised if the S&P 500 moves back into the wedge today (over 1100), or moves much further down than the 20-day EMA (~1084).  Monday would more likely be the day for the next bigger move, but again, you never know.

Next week is Thanksgiving week and, just in case you an IFT (interfund transfer) or two left in November, there is a highly positive seasonal bias on the Wednesday prior to the holiday, and the Friday after, but the week after gets a little dicey.
                    
                              Chart provided courtesy of www.sentimentrader.com

I'm a little uncertain what to expect today.  The fact that the indices closed well off their lows leads me to believe the buyers are still lurking, but as I mentioned, because of the options expiration, I'm not expecting too much action unless we get surprised by a significant news event.

Thanks for reading.  Have a great weekend!