With today's 37 point drop in the Dow we closed below the lower edge of the rising RTC for the first time since the beginning of December. The more adventurous will call the uptrend over at this point. Technically, we need to see one more down day to declare the uptrend dead.But note the shape of today's action, forming a nice hammer candlestick. That is a bullish sign. And note that volume has been decreasing over the last three losing sessions, suggesting the bears are having a tough time driving the market lower. Also, the indicators are off their recent overbought levels and all three futures are up 0.1% to 0.18% right now (1 AM EST). Also, tomorrow is Tuesday, which is generally a good day for the market. And the VIX, which gapped up this morning, hit its daily upper Bollinger band before retreating to close at 17.54, its low for the day.
All of these factors may combine to keep us from going lower tomorrow. So the best I can do at the moment is to call the current swing trend over but not declare a downtrend yet. Note though that we are still well within a longer RTC uptrend going back to last year's lows in June. Right now, it wouldn't surprise me to see the market go higher tomorrow.
No trades today
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