Even better-than-expected earnings from the chip giant Intel failed to move investors to a more positive view of stocks today. Instead they focused on economic data rather than earnings. S&P down 0.17 points at 1095.17. I still believe that market will have some more upward space to move to secondary high of this bear market counter trend rally. However, market is a bit overbought right now. Healthy market needs to digest properly before another upward wave.
Market is at 50 days moving average, 200 days moving average is 1112 above, 20 days moving average is 1075 below. If 1100 is our temporary top, then we have some fib retractment supports for 38.2%, 50% and 61.8% , they are 1065.6, 1055, 1044.38.
I still shorting this market with SPXU. If tomorrow market start retract, I will cover half of my short at 1075 which is the 20 days moving average, I will cover another half at 1065 or 1055 depend on the internal indicator's oversold signal. Patient traders may want to cover their short at 1055 which is the 50% fib level, it's also the the most common retractment % level. We will have a better perspective about the strength of this rally by looking at the retractment too.
If market decide to go up to 200 days moving average 1112 tomorrow, I may add up some more short if all the short term indicator is at extreme overbought level while 1112 act as a solid resistance.
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