Market Update

The market closed the 3rd quarter with a thud, that followed thru to start the 4th quarter.

Since I posted the above chart on August 1st when I suggested "cash continues to be King" the markets have been taken out behind the woodshed.

The August trendline break has triggered a significant sell off.  After 8 weeks of range bound trading the S&P is breaking out of its triangle.  Unfortunately, it looks like a measured move is setup.  The target for the measured move is about 950 which would coincide with a 61.8% retracement of the rally that began in 2009.  There is some pretty decent support between 1020 and 1050.

On the monthly chart, a sell signal has been generated with the MACD going negative in September.  This supports the target of 950.