I am getting a lot of questions this morning. That means the players in the market are confused. They should be.
Right now we have a very dynamic daily setup in the SP500 where the immediate term TRADE lines (buy 994, sell 1004) are only 1% apart (see chart). Tight is as tight does, so for now, trade that range.
A close and continued breakdown of the SP500 below the 1004 line keeps the intermediate term TREND line in play (947). Whereas a close above 1004, and a breakdown of the US Dollar Index below the $78.54 level, puts 1020 in play again on the upside.
The topside of this risk management picture is, of course, a lower-high, versus the YTD closing high of 1030. On the margin, that’s bearish. Fundamentally, I do see a bearish unemployment report coming on Friday. So managing risk with tight stops today/tomorrow is paramount.
KM
Keith R. McCullough
Chief Executive Officer
