SPX has dropped right to the support zone we noted, and is trying to bounce. NDX and Dow have not approached their commensurate supports. I have removed the lower triangle lines from the charts in favor of channel bottoms for SPX and lateral support for NDX. The triangles broke down and are no longer of use.
Aside from arguing that SPX could attempt to find support soon, the lower channel line also puts a new upside parameter in the event SPX bounces as speculated, post-FOMC and in the event that said would-be bounce would exceed the initial parameters at 2050 to 2060. Notably, even with a bounce of that magnitude notice that SPX would still be in a new down trend channel as it has now made a low in November, a lower high and on Friday, a lower low. So I still think any bounce would be just a quick trade only, for those inclined or better still, an opportunity to wait to re-short.
I have covered the short on the SPX and also on the EM’s. One for a good profit and the other for a reduced profit (better than my recent performance on this thing, anyway). The only short I hold is against LRCX.
I’ll try to do a wider ranging update tonight or tomorrow morning. I have to be out for most of the rest of the trading day today. In that regard, I am flattening out to even higher cash levels, selling/covering anything I do not feel like a true believer in, which is most things right now.
