The S&P 500 started to slip under 4088 this morning and working its way toward the next major retrace of the advance of the March 28th low at 4066, a 32% retrace. S&P 500 futures have tested the equivalent 32% retrace at 4100.50. Is the test of the futures retrace good enough or do they try for the day session version? A case can be made for a five wave fractal down from yesterday in Nasdaq 100 and S&P 500 futures. Dow futures have been resilient so far and have resisted making a new low under that of yesterday. In general, I want to give bears a chance to form a lower high late today or early tomorrow though a fresh swing high is still possible while above 4066 SPX and 4100 in the futures. Areas of interest in SPX are at 4088, 4095, and 4111.
Since I mentioned it, here is a 30-minute chart of the Nasdaq 100 futures to illustrate the possible completed five wave impulse down from yesterday. (I) down pre-market, wave (II) on the lower high after the 10am volatility, wave (III) on the late day low, wave (IV) overnight, and finally wave (V) down this morning.
Here is a chart of the percentage of S&P 500 components under the 20 day moving average. Note bounce back up from a zone that has marked reversals in the past. Like the SPX itself but in reverse, I can’t quite rule out a retest of the low over the next few days, but it does look like equity bulls are a little overconfident to me.
I’m pretty excited about the Euro falling away from 1.1013 today in what could a lower high against the early February high. I think a weaker Euro and stronger DX has negative implications for the equity markets
Bonds have been a bit of a problem child, but with a pattern similar to that in gold, may have five waves up from the March 2nd low and thus a possible [V] of c of (iv) candidate. If trading bonds long, might lock in some profits. Fade? Very aggressive prior to falling back under 133^11 or better yet 132^25.