Watching For the End of This Correction

The market formed an up trending price bar on the daily cash S&P500 chart yesterday. The rally, on lower volume than Tuesday, reached the short moving average before pulling back slightly. As expected the price action has turned the swing chart (shown by the solid orange line) down for the first time since the July 8 low.

With the rally now spanning two sessions and the futures up 3.7 points at 7:02am, we are forced to ask “Is the correction over”? I don’t think so and will be watching for strong resistance in the 1006 - 1007 range with immediate downside price targets at 969 and then 961. As I am expecting one more rally phase into the Autumn it would not be worthwhile to pin too much on the bearish side. Ideally (over the coming week or so) we fail to clear 1013 and then hit the 961 level next week. But asking for the ideal is usually too much …