12/2/2013

S&P 500 - Daily Chart

A decisive dip below 1800 would break a pretty strong trend on the daily chart - going back almost a month to November 7th. This would potentially signal more downside, and sub 1795 would confirm more short term weakness.

The current mini down wave could be forming a flag, although the post is very slanted. If this scenario is taken into account, breaking through the 1806.60 area, ideally passing 1807 would perhaps create a good entry point. If not, the 1808 area has been a point of resistance lately.

On Balance Volume seems to be following the market so I'm not terribly concerned about much more downside into the month. In fact, I can envision it flipping back upward before the week is over.

The S&P punched below the 5 day MA today, by 4 points or so when it went as low as 1798.60 - something to keep in mind.  In recent days, a break below the 5 day MA was followed by at least another new low.

- TWW