In terms of modeling price momentum, Monday’s move to the downside was more important than yesterday’s reversal to the upside. Now my downside target for the SP500 moves all the way down to 729. In the chart below I have lined up where the sharks will be jumping. There are 2 important lines of immediate term “Trade” resistance to keep your eyes on - SPX 785 and 822 (dotted red lines). In the next few days, if we can’t close above that 785 line, the probabilities of seeing 729 go up.
Intermediate Trend line resistance is a long way from here, up at 865 (solid red line).
Keith R. McCullough
CEO & Chief Investment Officer