Market Montage

Nothing more to say if you have been around for a few years.  We have seen this now 40-50 times since 2008.  The WSJ is writing that the Fed is "closer" to acting and the market took off from very serious losses.  We were well below the 1338-1340 level, and now this news story has pushed the S&P 500 right back into that range.

Fed officials, impatient with the economy's sluggish growth and high unemployment, are moving closer to taking new steps to spur activity and hiring.

Same stories, same headlines, just change the date.

I've been charting the action since early June mostly via a chart connecting a series of higher highs and higher lows.  Using that approach the market broke out above the top of the higher highs middle of last week – only to fail.   Another way to look at that time frame is as an upward channel.  What we can see is there have been 3 iterations of violent moves up and down since early June.   It has been a failed trade to "buy a breakout" at the top of said channel, OR to "short, assuming a breakdown" at the bottom of said channel.  Until this time.  …

We are again seeing the S&P 500 come into the 1340 area.  If you look back throughout 2012 you can see how 1340 provided support in February and early March multiple times, then was resistance in May and early June.  Since then we've seen the index thrash violently around it (and its friend 1370).   If yesterday's lows break later today it could provide some fireworks going into Apple's earnings.

This is another of those sessions where the index is not showing what is going on under the surface – I don't have a single sector ETF in the green despite the market 'only' being down 0.6%.

On the economic front a decent number in the housing market yet again but an awful regional Fed survey.