Market Update - 10/20/2009

Dow Jones Industrial Average: -50.71 or 0.50% at 10041.48

S&P 500 Index: -6.85 or 0.62% at 1091.06

NASDAQ Composite Index: -12.85 or 0.59% at 2173.47

NYSE Internals: 1047 Advance. 2007 Decline.

SPX did not cross back above 1100 today. In fact, we broke 1090 intra day, but not 1080.

The blue channel was finally broken today. Looks like we are retesting it. Retest should be somewhere around 1095-1098 tomorrow. If we continue downward and break 1080, good chances are that the top could be in because the waves are starting to overlap.

The reason I am hesitant to call a top at those moment is because we did not impulse down today. The bounce up from today's lows did look corrective, but regardless, the A/D was about 2:1 down. Not very strong to the downside.

The two important numbers to watch for tomorrow are 1080 and 1100. If we break 1080, then more downside may be coming. If we break 1100, we are probably going a little higher.

US Dollar was up, Crude Oil and Gold were down. VIX was also down. This is a sign of complacency in the market. There is no fear at all. Bullishness is at an extreme.