$SPY opening pretty much flat today after yesterday’s slide. This morning analysts expected the CPI (Consumer Price Index) to rise 0.2 percent last month. In the 12 months to July the CPI rose 1.4 percent, slowing from June’s 1.7 percent rise.

The news are always important, but working with the charts do give a better understanding of where we are, and where we will go. The $NYMO (McClellan Oscillator) have been helping me the most. On the past 4 days excluding yesterday it has been flat after a steady five days rise. On previous instances the 2 to 3 days after have been followed by a drop like we saw yesterday, and then another two days of big drops that can easily wipe out the week gains and some more in a matter of days.

Yesterday we can count as the first day and from previous instances there are still 2 to 3 days. So the best way for one to approach today is to watch for some shorts as we might open flat, and rise a bit, just enough to get some people to think that this is a buy-able dip, and then these unfortunate souls will hold the pot as some of the more experienced traders sell this market again in an orderly fashion. The selling will be held by support during the day, but have a good chance to be vicious by the end of the day.

Now let’s go to the numbers.

$SPY 1st support is 140.01, 2nd support 139.50, and 3rd is 139.21.

$SPY 1st target is 140.64 , 2nd is 141.12 3rd is 141.56, and 4th one just for fun is 142.26.

Trade what you see not what you think.

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