The market has done what I said it would do.
As I said yesterday we are now in a state of indecision.
There is a potential for a blow off rally before the bottom falls out.
Where could that take us?
Do a Fibonacci Retracement of the recent drop from 1375.
Where did you find the 50% area? Did you notice how perfectly the pattern fit the Fibonacci ratios?
So what's the answer? Could it be in that area I described as a "barrier"?
That is one likely possibility, and 1409 is still on the table. That was a Fibonacci level also, but it's a long shot right now.
So what happens if the 50 DMA fails?
What's the -38.2 % level?
Do you see how that jives with the 200 DMA and the bottom tine of the Blue fork?
Well there's your answer.
Sorry looky loos no pretty pictures today.
The candlesticks show a Doji. Remember yesterday we had a bottoming tail and I warned that this could indicate that the bears are taking a rest. Well this Doji is even more evidence that this area is full of indecision. Watch for a higher close to confirm a buy signal, but don't get too long sighted if you are long. This market feels like it's getting close to a full on collapse.