Second, the SP500 was interesting to say the least. Before reading below, I want to remind everyone of the concept displayed in the previous Market Thought post "if,then"...
Ultimately the action today was consistent with the previous posts. The SP500 came in contact with the weekly 62SMA, and bounced. Then on the monthly chart, there is a series of support around the 1050 level as well.
Earlier in the day I stated there were internal interactions that indicated to me strength coming into the market. That indication came from the multiple real-time tick-by-tick action from a collection of what I think are core equity market leaders. Then, GS just started to blatantly outperform everything, and did not look back.
Clearly there was strong buying going on at the 1050 level, and this most likely defined our low. I still believe there should be a churning, but if European issues begin to fall in place, or the 'perceived negativity' subsides, we may just rally. The economic data and earnings are really strong, but I am not ready to let go of the churning thesis.
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