Mr Market cut through 2025 like a hot knife through butter.
spx.png
The plunge protection team was activated when it dipped below 2000, and the 1990-2000 area became the battle line for the day.
We're now deeply oversold, with an RSI of 26 on the hourly short term chart, and it was even lower earlier today. I would expect a bounce soon, probably tomorrow, but dead cats don't bounce too far. I thought of going long tomorrow (on a very short term basis, like a day or two) to take advantage of a possible bounce, but it would be a total crapshoot. Nah.
The daily chart (below) reminds me of last August, and possibly like this January, when we went over the waterfall.
spx.png
There's a lot of technical damage, and it won't be patched up in a day or two. This will take weeks of up and down moves (mostly down) before we know when an intermediate term bottom is in place. We blew right through the 200 day, and the next possible support is the 50% Fib retracement. Good luck with that. I'm guessing we at least test the 62% Fib, if not all the way back down near the February lows near 1810. We should find much more support there.
F Fund has been the place to be, but right now is too risky to buy in for my tastes. AGG had two days with gaps higher, and the RSI is now over 71. We're also pushing outside the upper Bollinger, so a cool down is in the cards, IMHO.
The strengthening dollar is holding back commodities, esp oil. WTIC just cut through it's 50 DMA, something it hasn't done since Feb. Look out below.
These sure are interesting times. I hope very few of you are losing money during this market rout.
Composite system remains at -3, a strong sell.
Bookmarks