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Market Comments for Tuesday, March 10, 2015

 

Yesterday the market gapped up and initially fell to test the low of the prior day which set the low for the day at the 10.00 reversal time. From there the market rallied back some, but stayed inside its trading range all the way through lunch. At the 1.30 reversal time the market broke above the intraday consolidation and rallied to make a new high. This however was met with strong selling and the market returned to test the low the day before closing in the middle of the day’s trading range leaving a near perfect Doji on the daily chart. The SPY was similar but slightly stronger throughout the trading day.

While the market broke out and rallied on the five minute chart, it was all playing into what may be nothing more than a big 60 minute sell setup. The resistance line at the chart at “1” is exactly where it was drawn yesterday. This area was hit and the market rolled over. We now have some firm lines in the same for today. Resistance is at “1”, and support is at “2”. The break of either one of these lines would likely continue the move in the current direction. Note – as of an hour before market open the market is gapping down a large amount. This does not change the bias although the area at ‘2’ may now be the resistance area depending on how it is reached. The SPY daily is already on mS, but that is only because of its relative weakness over the last month.