It is always important to keep the larger timeframes in mind - After making an excess high at 1468 - we have been balancing for 3 weeks now within a range that extends from 1424 on the low to 1462 on the high. So far it has been an Inside Week. If we continue lower, our immediate downside weekly reference is 1424 and below that the 1418 area - which represents the prior yearly high and the level where the S&P's broke out to the upside following the FOMC announcement. Lets look at the profiles -
Today's profile is shaped like a "b" - implying longs liquidating - with Value overlapping to lower. For the past 3 days we have been closing higher each day but unable to close above 1444 - a key reference that I have been pointing out for the past several days. The market made several attempts to get below 1433.25 as well - but found responsive buyers below - that rallied the market into the close. Both Friday and Tuesday have poor lows which limit the odds of upside continuation and at the same time raise the odds of auctioning lower. I am treating the last 4 days as balance and see whether we open in or out of balance relative this range.
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