Technical Damage Noted

After making high on Monday the cash S&P500 sold off sharply late in the day. Follow-through to the downside continued on Tuesday as we made a downtrending bar. In Elliott terms this top would be wave “a” of the next a-b-c pattern after the first a-b-c-x from the March 17 low.

The high on Monday came with technical damage. The RSI not only made a negative divergence (sell signal) but was turned back in the area where bear market rallies find resistance. The DeMarker (13) indicator also fell from above the 70 level indicating a “high risk” area had been reached (in the short term).

At this point I will stick with the roadmap presented Monday. And with that it is time for holiday. I will return in a few weeks. Take care.