The market has now declined twice in 5 waves in all the major indices. The evidence continues to point towards immediate market weakness instead of any strong rally occurring first. Above is the S&P 15min futures chart that shows a 5 wave decline, then a fibonacci 78% retracement, then another 5 wave decline. This tells us the trend is now down.
The next level the S&P futures needs to break to strengthen the bearish view is 852, and in the cash S&P it's 857 and 851. A break of those levels in both the futures and cash markets will confirm that a strong declining phase is back underway that should take the S&P to AT LEAST the 750 area.
3 comments:
Ouch. Thanks Todd for the analysis.
Hey Todd, are you going to invest in 3X ETFs like FAZ and TZA? you can double your money if the S&P 500 drop straight(no rally in between) from 850 to 750.
Probably not now. I use double short ETFs like DXD, SDS and QID. I won't go heavier until the market structure is more clear, and perhaps a large 3rd wave is about to get underway with a clear risk/stop level.
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