Market Action is at a Critical Support Junction. Does It Break Up or Down?
5 Days, 15 min. - Oct. 2 - Weak finish at the end of a down day. Effort to break out to the upside failed. Short term correction continued into the close. The weekend may change sentiment, but there may be a continued move to the downside. As the headline indicated the results right now are up for grabs. The bulls have a way of storming back a bringing in surprising support in spite of calls for a significant market correction. If support should fail the market could drop to a much lower level.
20 Day, 2 Hour - Oct. 2 - The declining trend line reveals the correction that has started. This short term chart looks very bearish, but the longer term charts have not yet confirmed a move lower. The bulls can always come in with a bounce.
3 Month, Daily - Oct. 2 - The 3 Month chart shows a failure of support with a large candle down at the close. This is bearish but at the same time could bring about a bounce at the open. If the internals are not strong, the bounce may well fail and the market roll over to the downside. Note the RSI and CCI at very oversold levels. In the past these positions have led to significant resumption of the bull rally. The RSI, CCI, and Internals should be watched closely for directional signals. It will be an interesting week.
1 Year, Weekly - Oct. 2 - On the Weekly chart the market sits on support without the break seen in the Daily (broke support). The market action on Monday will tell us a lot as to where we go from here.
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