Has U.S. stock market turned bearish?

January 15, 2016 02:47 PM

The S&P 500 Index is experiencing a decline of 2.6% decline (-50 pts) as I write. At 1872, SPX is within a handful of the August 1867 low.

There is no overriding technical formation in candlesticks today. The "shaven" top, where the opening is the high price is bearish, but not terribly rare in this market. 

There have been 9 new lows over the last 12 sessions which indicates it is stretched.

A settle to new multi-month lows would give folks something to talk about over the long weekend, while a bounce from here will excite further interest in the August lows as a support level.

The short term trend is clearly bearish and it started with a bearish Harami on Dec. 29-30. A settlement above 1900 would be required to indicate a bullish technical formation today. Anything less is a bearish candle and projects lower levels.

About the Author

Martin McGuire, managing director at TJM Institutional Services