In the case of the S&P, “The trend is your friend, until the end, when there’s a bend” – and that is exactly what we got today out of the all-important index. The trend-line that has been intact since early March have finally given way to the bears, and not only that, but the 50-day moving average has also been busted, closing significantly lower than the strategic area of support. So what’s in store here? I’m not sure, I’m still short via SDS on the S&P, and I expect it to go much lower in the long run, and could continue that path yet again tomorrow, if the jobs number disappoints. But don’t be surprised either if we get some kind of snapback/dead cat bounce tomorrow. With that said, my stop-loss on SDS will be dramatically increased tomorrow.
The NASDAQ isn’t any better with the pounding it took today. I can’t recall a day like today since pre-March – in essence, the NASDAQ looked like 2008 all over again. Like the S&P, it too gave up the 50-day moving average and is close to challenging the October lows. If they break them, then we are likely to see some serious chaos in the markets.