Indexes opened significantly lower after overnight weakness and sellers were out in full force this morning. The Russell 2000 (-2.49%) and financial sector (-1.94%) lead the way down today but the market drifted higher from the 11AM market lows for another trend day fake out. Some very short-term technical levels have been broken, most notably the ES 1100 (SPY 110.5) level I was talking about yesterday. The market needs to hold below that level or we will return to the range trading we have seen the past few days. Follow-through is everything for bears. As of now, I see this as part of a range bound trading between SPY 108.80 and the highs. SPY Levels to watch tomorrow will be today’s low 109.13, 108.80 as far as downside and 110.50 as far as upside.
Economic Data:
- Today: Unemployment Claims (505K vs 503K), Philly Fed Manufacturing Index (16.7 vs 12.5), CB Leading Index m/m (0.3% vs 0.5%)
- Friday: None
Evening Reading:
- Other risk assets not confirming today’s drop (Trader Feed)
- We go lower (Leigh Drogen)
- Why the HFT mania? (FT Alphaville)
- US Mortgage delinquencies reach record high (NY Times)
- Dollar weakness and stock strength: the data (A Dash of Insight)
- Economists opposing Fed audit are on Fed payroll (Mish’s)
- Sounds during sleep aids memory, study finds (NY Times)
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