From the desk of Vance Howard:
The market traded just about spot-on to last week’s Wealth Watch, with the S&P 500 rallying up to the 3,900 area before the sellers came in to drive the index back down. Some of the reason for the rally was re-balancing of portfolios by fund managers, but that should be complete by the end of the week, and we could see the indexes sell off even more. The 3,648 area on the S&P 500 is critical. We could see the market selling off to retest this area of support, and if the market does not hold then the next level of support is around 3,422 on the S&P 500.
I expect that the next couple days might show prices attempting to stabilize, and we could possibly even see a minor bounce. However, trends are bearish, and I do not anticipate that Tuesday’s high of 3,945.86 will be taken out before prices make their way down to challenge and undercut 3,644, even if this might require a couple weeks.
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