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This morning the market has created an upside gap between S&P 1194 and 1197; yesterday's low and today's high. I would think that would fill quite quickly even if there is more downside to go. Complicating matters is the 20 day moving average is 1195 which has provided the resistance for the day.
While we are now below the 200 week simple moving average of 1192; I would definitely like to see a close below that level to feel comfortable changing the complexion of things. Further, the cynic among us have to believe that the market will be up on GM IPO day tomorrow. So for now, I'll continue to look for long side positions to trim upon weakness while adding many more stop losses, and start looking for weak charts for individual short positions. If nothing else the "no thinking" market appears to finally be over, which is a relief. A series of closes below this 200 week simple moving average means bulls are in trouble... Turkey Day or not. Obviously 1170 is the next tangible downside target; the 50 day moving average. But I don't think that is a story for today.
Ironically, this market is 0 for 2 on QE2 POMO days, and trying to make it 0 for 3.
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