For the cash SP500, both daily (1345.20) and hourly (1343.78) TDST resistance continues to hold back the market. The daily break of the TDST line (horizontal, dashed red line on the chart) was not confirmed on Friday since we opened below the line. This failure was evident in yesterday's down trending price bar. I interpret this failure as a warning that the delta pulse is running out of steam. If so, then last Thursday's high should not be exceeded in the near term.
On a hourly basis the break above 1343.78 on Friday was not qualified and we had a bearish price/RSI divergence at the 1pm hour. This technical weakness also preceded yesterday's decline.
Now, the onus is on the bulls. They must prove their case by getting through (in a qualified and confirmed manner) both the supply line (down sloping red dashed line) and TDST resistance on the daily chart. If they can do so I will sit up and notice!
Bottom Line: The allocation mix meter is at +50%. I remain quite concerned that the rally high from the 2009 low was made on May 2. As such, I will be watching closely for confirmation that the July 7th high was the top of a counter trend rally.
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