The decline yesterday was dramatic, but not sufficiently dramatic in my view that we should now assume that the spring high was made on Tuesday. Bears will need to follow through and close below 1850 SPX before that assumption can reasonably be made.
I’m just looking at SPX and bonds today but I will just mention that the low on RUT yesterday was at 1082.53, still in the lower range I gave yesterday morning for a possible bullish recovery, and that NDX didn’t break rising support from 3414, though it came very close to testing it. There is a strong argument that this decline has limited the scope for further upside however, and if we should see a strong recovery from yesterday’s lows then I would mention that something often seen at significant highs is a sharp spike down before the main slightly higher high. This is a common way to set up a double top. (more…)


