By Andrew Nyquist
The gentle pullback came to an abrupt end this week in the financial markets. What was a nice easy pullback above key supports turned into a technically damaging one this week.
As noted previously, the S&P 500 breached lateral support and the 38.2 Fibonacci level, closing on its 200 day moving average and nearing the 50 percent Fibonacci retracement support. See daily chart below. Dangerous territory here if this level breaks down.
I am now focused on the 1370 levels (give or take 5 points). If this support breaks, look for the markets to target 1320 as the next level of support. Should this happen, investors may want to tune in to the weekly DeMark set up counts. The Nasdaq 100 is the most beaten up, so we’ll start there: recorded bar 6 of a 9 buy setup, this coming week will be bar 7. The S&P 500 recorded bar 5 last week and will be on bar 6 this coming week. See charts below. For more read Understanding the Basics of DeMark Setups.
Trade safe, trade disciplined.
Positions in S&P 500 related SPY and Nasdaq 100 related QQQ at the time of publication.
Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of his employer or any other person or entity.