S&P Shifted to Low Level Consolidation Phase Prior to New Downswing

the fact that the S&P is basing sideways rather than bouncing higher as market digested Tuesday’s massive selloff indicating an internal weakness. Nevertheless, we’re expected the S&P to shift to an orderly low-level consolidation period prior to new downswing as the 2600 zone is too big and too important to fall quickly

February Lows Might Not Hold for Long

Tuesday’s massive selloff pushed S&P down to formidable support zone. Momentum and Money Flow measure are not favorable over the near to intermediate term, suggesting the support might not hold for long. With that said, this is not a time to be long. If the market is going to find a bottom in the near term, we want to see the S&P stabilizes and bounces off 2560

Relief Rally Could Take S&P to 2700 before Significant Pullback Unfolds

based upon recent trading action, an important near-term low had been established and the S&P index is in an early stage of a snap back bounce. Our near-term work on momentum and price structure suggested that the relief rally can be sustained for a few days, potentially allowing for a test of 2700 before a significant pullback unfolds

S&P at Risk of Breaching February Lows

the biggest near-term risk for S&P is a breach of early February lows. That level roughly corresponds with the bottom of its short-term trading range. When key supports broke it means that long-term buying pressure has finally been exhausted. Nevertheless, a deeper pullback would be constructive in that it would generate oversold conditions within the framework of the long-term uptrend

S&P in Period of High Volatility

S&P entered period of higher volatility. The index will have a downward bias going into the end of the week, pressured by negative momentum but we expect support at the February lows remain largely intact. There is a high probability that market is in for a ‘range-bound’ trading environment. This is a rally and retreat environment. It is not a trending environment. Short-term traders can anticipate continued volatility with rapid up and down moves in the markets

S&P Vulnerable to Lower Prices

momentum deteriorated as S&P struggled to get pass the trend channel moving average. Wednesday’s weakness had improved the posture of our short-term indicators, which remain supportive of further pullback. The longer the index stays below 2747, the more vulnerable it is to lower prices

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