Chart of the Day – Bad News
The chart says it all. And, I’m already preparing for the critics to say” aha – see you were wrong”. S&P 500 - 10/28/09
Now, I’m about 99% sure the recent selloff has been so nasty so quickly that stocks are going to bounce a little in the near future. I’ll just remind them in advance that this trend didn’t start in a day, and it won’t be stopped in a day either. If the rebound is weak and on light volume, it won’t last long. Take a look, but keep reading. The pullback has been strong, on heavy volume. Connect on Facebook | Follow on Twitter FreeTradePicks.com | Login | Get all our email updates here! When I posted Monday’s chart of the day illustrating how the market was en route to snapping a very important support line, I had a bad feeling I’s be updating the chart real soon. That’s fine. As for a final resting spot, I’ll make an aggressive projction (again) and say the S&P 500 is due for a move back to 940. That’s where a 38.2% Fibonacci retracement line is waiting. The S&P 500 plunged under that support level with today’s 1.3% dip, and as such, may have jump-started a much bigger implosion. And, the market didn’t disappoint me. The floor that had caught and reversed all the prior pullbacks didn’t manage to halt this one in its tracks. The real litmus test, in fact, will be what happens if/when stocks try to rebound.