A quick view of what is happening with our short-term 60 min. chart. SPX bounced to test the broken moving averages and failed in a classic manner.
Now comes the test of support by the daily chart that we also reviewed. We have been expecting the gap to fill and support to be tested around 2060. We are there. Either support is going to hold or the next target is 1980 to 2000. My guess? It goes lower, perhaps after some jumping around at current support. The reason I say that is because in each of our ‘comps’, 2000, 2008 and 2011 the failure of the bounce backs equivalent to what we just saw in October, was a fairly hard drop.
