The SPYs have broken through key technical support and
have decreasing momentum. In addition
Notice that prices have been decreasing on (A) increasing volume. Prices are now below the 10, 20 and 50 day EMAs. In addition, the 10 and 20 day EMAs are moving lower and the 10 has crossed below the 20.
The big problem is the sell-off is occurring across all markets.
A.) The Russell 2000 formed a double top. This is a classic reversal pattern.
B.) Prices have fallen below the mid-point between the two tops on
C.) increasing volume. In addition
D.) The 10, 20 and 50 day EMAs are moving lower, the 10 day EMA has moved through the 50 day EMA and prices are below the 10, 20 and 50 day EMA.
A.) The Transports also formed a double top.
B.) Prices have fallen below the mid-point between the two tops on
C.) increasing volume. In addition
D.) The 10, 20 and 50 day EMAs are moving lower, the 10 day EMA has moved through the 50 day EMA and prices are below the 10, 20 and 50 day EMA.
The one good thing about the transports chart is it is approaching the 200 day EMA for technical support. But if it falls through that line, we've got problems.
A.) The QQQQs broke upside support some time ago and
B.) Prices are falling on increasing volume
A.) The 10 and 20 day EMA are both moving lower and the 10 day EMA has crossed below the 20 day EMA
B.) Prices have moved through the 50 day EMA on
C.) increasing volume.
Bottom line: this is a market that is looking to move lower.
