Today seemed like a mirror image of last Friday. We were down a good amount in the morning and then we reversed back up at the end of the day. The reason for the up move today was ovbiously the Fed announcement. However, the one difference between the 2 down moves is the internals. At the low today, breadth was about 22:1. But this quickly reversed as the market started to come back up.
So for now, we cannot seem to get a sustained down move that holds. This is bullish price action. Breaking back above 1125 could send us to new highs.
1111 and 1107 are the key downside pivots going into tomorrow. If we do get a big down move that holds and the market breadth does stay strong, there is a good chance that we have topped.
But until we do get that down move, the trend is still clearly up. It may be fading, but it doesn't want to give up just yet.
The key index to watch is the Russell 2000. It seems to be diverging away from the other indices. It hasn't made new highs since the last week of July, and it seems to be making lower highs.
If we can get a lower low, the Russell may set the trend for the other indices.
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