The ST again has proven reliable, and while it can be inaccurate in times of high volatility swings, it does also do well in long runs like we had in the Oct. rally. So far it has also been good for the recent turn down. The SPX at the moment is at risk of an acceleration down as I indicated in yesterdays (PA). The close today has only increase the odds for more acceleration to the downside so beware of such moves.
The low today also not immediately evident was the Fib. level of 38.2% from the lows of late Sept. to the highs made early this month. Of course this on top of the support of the Daily 75 MA and Lower BB line. Levels to watch here on out is the lower Fib. retracement levels of 50% and 61.8%.. If the intra-day signals does bounce and moves out of OS or into OB range, we should look to exit any short position. Ultimately, it will all depend on your exit strategy which will never work if you do not follow it.
SEN: Bearish
ST: DOWN
PA: DOWN
Note: Last week I mentioned that our Sentiment indicator was at risk of turning bullish and that we needed a big turn-a-round this week to halt it from extending into bullish territory. This week the movement in price achieved that goal and it still remains "Bearish". Often times when studying the behaviour of these signals, we can see also the subconscious behaviour of the markets. How is it that the one signal that a few or no one ever follows warns us that a change of trend needs to occur before the market changes its sentiments? This is technical analysis, and it's why I believe in it so much. We just need to fine tune our understanding of it.
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