Wow... what crazy day in the market! When I posted yesterday that the market would have wild swings today I never imagined a day like today! The volume was huge... 254 million in the SPY today... that's more then both Monday and Tuesday put together. I was away from my computer and missed the bull slaughter in morning crash, and the bear squeeze the rest of the day.
However, I would have stayed in my long as the 104 (spy) area is major support. I'm still looking for the final high next week. I don't know if it is going to close that year old gap or not, but I'll be fully short next week after the final top occurs.
When I got a chance to get to my computer it was around 2:30 pm. By then, the market had recovered the entire move down and was sitting at about the opening price. So, I sold my longs, and went short as I said I was going to do. I expect some down moves in the next 2 days. First major support is 1040 spx, then 1020. So, if will close below the 1050 spx intraday (on the 10 minute chart) we should head south to 1040-1042 area for support.
I don't know if that will break or not, but if it does... expect 1020 next. I feel that the market will have a hard time rallying back up to close that gap at 1100 area if we break 1040 on the downside. Next week is when the major turn date down occurs. Some have the 6th-7th, and other's have 8th or 9th. Either way, next week will be the high.
So, I'll be looking for economic news that can move the market the most next week. Whichever day that happens on could be the turn date? I'll just play it by ear, until it gets closer. I'm looking to get out of my shorts Friday as I don't know how much they will rally it next week.
I may or may not go long on Friday? Hard to say at this point, as it's dangerous to go long this close to the end of P2. It may be safer to sit on the sidelines until I'm ready to go short again next week.
That's all for day. I hope no one got raped today!