S&P 500 Trading Outlook (3-5 Days): Bearish
Poor risk/reward with prices up to near resistance, but not over.
Until trendline broken, it’s right to expect a stall-out and pullback.
A close over 2862 tilts the bias to bullish for a larger rally.
THE BOTTOM LINE: Trends are bearish and momentum still hasn’t gotten sufficiently oversold to suggest lows are in place.
While volume was very heavy on the downside, which often can occur close to lows after an extended decline, it looks right to stay defensive until prices reach down to 2785 or manage to rise back up over 2862 on a close.
As written about last week, downside should be limited to 2775 to 2785.
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Author has positions in mentioned securities 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 any other person or entity.