If I'm looking at this market as an oversold bounce versus a leg up, then it's important to consider where the bounce can carry to. SPX, the 1224 area looks like some rather serious resistance. That was a key area on the way down and now becomes the same on the way up. 1225 to 1232 or so should contain the move if it's going to fail. 1225 would be a good short if we get there today or tomorrow as we should see a move back off that area and then a retry to take it. You can extrapolate these numbers to the other indexes as well. For example, 1589 NDX is another key area. The NDX is already running into the resistance here at 1584 since that's the 20 day MA. The 50 day MA is up at the 1589 area.
So, there's still a little room to run, but it's not unlimited short term so don't get sucked into the idea that it's time to buy and hold here. This is not what the charts are telling us.
So, there's still a little room to run, but it's not unlimited short term so don't get sucked into the idea that it's time to buy and hold here. This is not what the charts are telling us.
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