Standing On the Precipice

4 Jan 2016

First, I hope everyone here on TradingView had a Happy New Year! My first post of the year is a very bearish one for SPY with the week ahead looking at selloffs to retest the $200.00 level. The trading during the shortened New Years week was lower in volume, but still indicative of an overall bearish sentiment in the market. My forecast is that Monday or Tuesday may see SPY hovering around the $202.50 level before retreating even further to $200.00 later in the week. There is not much propping up the S&P at this point and I feel like we are on the precipice of another major selloff like we saw in August, with lower highs and lower lows preceding a breakdown to the $190's.

TECHNICAL ANALYSIS:

• Candle: Solid Red Candle (Bearish-Sellers had control of the market all of last Wednesday and most of Thursday)
  
• Volume: Increasing selling volume (Bearish)
  
• Stochastic (Slow): %D hovering around 50, %K descending, but greater than %D (Bearish-Sellers have control of the market)
  
• MACD: Histogram positive, but falling back towards 0, MACD moving towards a crossover of signal (Bearish)
  
• Overall Trend: Downward-20 day EMA (Blue Line) nearing a crossover of 200 day EMA (Blue Circles) (Bearish)
  

Agree? Disagree? Any feedback would be greatly appreciated! Thanks, and happy trading!