I find it interesting how much the action of the last three days looks like the action from January 24-26th: an up day, followed by a big up day, followed by a flat day. According to this pattern, tomorrow should be like January 27th, or another flat to slightly lower day. This theory is supported by the volume bars. Look at how the volume has been declining steadily for the last three days, suggesting we're running out of buyers at these levels. Also, tomorrow is Thursday, generally a weak day in the weekly cycle. And the third trading session of February is historically worse than the first two days too.In addition, all three futures are lower right now (1:15 AM EST). The one counter I can find is the VIX. It did go lower today as I was expecting, but it has room to go still lower tomorrow. This should mitigate against a large drop in stocks. Plus we now have the 12K level to act as support. This is mirrored in the S&P, which though it closed slightly lower today, also held its psychological even number at 1300.
So all in all, I'm looking for a flat to somewhat lower day tomorrow. The market may spend a few days at these levels recharging its batteries before continuing the march upward. We remain in the upward swing trend going back to December.
No trades today. The TIE I dumped yesterday did in fact move lower today, so I was correct on that one.
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