Hey guys, so yesterday was a rollercoaster ride, with another notable sell-off into the close. After some light selling in the evening, futures regained some ground, and in pre-market trading, SPY is back at yesterday's close at 342.67. Markets in Europe and most of Asia are also seeing some selling pressure.
On the daily, bears succeeded in defending the Green line resistance, and we closed in the red for the 4th day in a row. The 21 day EMA is holding up nicely as support since we broke above on Oct 2nd. The 100 day MA was tested on Sep 24th, and we had a solid bounce back to the all-time weekly closing high. I see the 100 day continuing to act as major support, and if breached, things could get messy.
On the hourly, we got rejected at the 100 period MA, and .618 fib (344.57), and saw a bearish close at 342.67. The bottom of the recent downtrend channel formed on Oct 12th is sitting right at the .5 fib around 340.22. I'll be watching this level closely today for a possible retest/break below.
Jobless claims are out shortly, and shockingly, in the midst of the greatest "recovery" in history, we're expecting another 860K job losses. Something just isn't right here guys, and heading into the fall/winter season, I suspect things are only going to get worse, particularly for brick and mortar retail. Continuing claims are sitting around 10MM still, and absent a notable decrease in today's print, I'm expecting bad news to act as bad news (for a change).
Super Pelosi and Bat Mnuchin continue to hash out details of a "deal," and it appears their best strategy here is to kick the can down the road, as long as they can, until the election. I won't be surprise if we see more "hope" and "optimism" narratives circling the news today.
I appreciate your time today guys! It should be an exciting day, and best of luck out there. Stay tuned for updates! Cheers, Michael.
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