The markets are setting up for a counter trend move. The 4 hour S&P 500 (SPX) is honing in on a ‘perfected’ TD Buy Setup which sets a bottom due late today or early tomorrow. If the SPX closes above 1661.23, then the TD Buy Setup will be reversed and is no longer relevant. The Dow Industrials (DJI) has been leading the indices lower and it will complete a 9 count TD Buy Setup today. What happens afterwards can affect the remaining indices so I am considering it an important benchmark. The Dow is completing the TD Buy Setup above the 14,971.20 TDST level. Having the current TD Buy Setup not close below the low of the previous TD Sell Setup is a bullish signal. The outcome can come in the form of a consolidation and considering other indicators are rolling over, my consensus outlook is to look for overall consolidation/retracement rather than a reversal to new highs. Google (GOOG) is also engaging a bull/bear debate. GOOG will likely complete a ‘perfected’ 9 count TD Buy Setup today. A round of consolidation is due at the least. As Google has already broken the TDST support at 874.19, this suggests that a bear trend will emerge once the oversold excess is worked off. The 900 price area is the main bull/bear level.
Still positioned short but will cut out prior to the close if the SPX can not produce another lower low at 1651.63. With some price exhaustion signals showing up, and the McClellan Oscillator at near extremes, markets are poised for at least a pause. (updated intraday)