Click on Chart to EnlargeThis morning the S&P 500 cash hit 1157 which is right near the 1160 area I have suggested as a topping point for this rally. It has sold off since this morning, and looks like it may form a bearish engulfing pattern today if the price closes near where it is at noon ET.
A candlestick reversal pattern right in the resistance zone would be a good confirming point that my outlook may be generally correct right now. If the market does indeed experience a pullback or correction from these levels, there will be some keys to watch for that I will lay out in a future post. Basically, if the correction does not retrace more than 61.8% of the Sept rally, in less time than it took to form, then I would lean toward another push up to higher rally highs. But we'll look at those situations as they come.
No changes right now to any trades. EUO will probably rally if the market pulls back from here. I don't know about TBT. There is now a huge bullish divergence on UNG on both weekly and daily time frames. If someone is not in this, you may want to strongly consider it here at this level. I won't be too quick to exit TZA if the market manages to get short-term oversold. I will mainly watch the hourly chart technicals for oversold conditions before exiting.
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