Dec 11
22
The bulls still have the momentum
Yesterday morning the market started off with a sharp selloff but ended up holding support and then turned back around. The S&P cash and futures held a retest of their 150 day smooth and 50 day moving averages, that is short term bullish action. I think that as long as the S&P cash and futures can hold above these moving averages the market……… will continue its recent run higher. The Dow remains strong and continues to be the upside leader. The Transports are still in negative territory for the year but they are now trading back above their 200 day moving average and that is bullish action. The Nasdaq on the other hand continues to struggle getting back above their 200 day and 50 day moving averages. If the Nasdaq cannot get back above their 200 day and 50 day moving averages sooner than later I think that we might see this rally stall or we may start to head back down. The Nasdaq was one of the upside leaders and when one of the upside leaders fails to get back above support we could see the rest of the market take that as a negative. Today I will be initially looking to buy breaks down to support at 1240.75 and I will be looking for a test of the 200 day moving average at 1255.42 (futures) where I will be a seller. If we cannot sustain trade above support at 1240.75 I will turn seller and then be looking for the Gap to filled in (Gap is also the POC) and also a possible test of the TOV where I will be a scalp buyer in this area. If we cannot sustain trade above the TOV I will turn seller and then be looking for a test of a group of moving averages; 10 day, 20 day, and 50 day moving averages are all within 0.60 of each other, I will be a buyer in that area. Failure to hold those moving averages I will turn seller and then be looking for a test of the 150 day smooth moving average and the BOV where I will be a scalp buyer in that area. If we cannot hold the 150 day smooth moving average that would be bearish action and I would turn seller looking for the single ticks to be filled in below for 1222.75 – 1218.00 and I will be a buyer at the end of those single ticks (we would also be close to the daily pivot at 1220.50). Have a great day!
