Last weekend, in my Market Forecast, I wrote:
"For the new week, the market is once again at a very precarious point. The market is in danger to test SPX 1100. We'll be watching SPX 1120 as a support. Similar to last week, financials will give clue to the downside movements while techs shall lead any bounce. Oil looks to break down even more, which should continue to pressure energy stocks. If the market bounces, SPX 1180 could be a strong resistance."
On Monday and Tuesday, the market did indeed bounce. We picked up quite a few nice, fast winners in the Trading Room. However, as forecasted, SPX 1180 proved to be a strong resistance. The market sank back to close below 1180 on Tuesday. Then, the tide quickly turned. The market struggled to keep its altitude on Wednesday and Thursday, we cashed out our trades on the longside and started trading the downside. On Friday, the market gapped lower, but, quickly bounced. However, the bounce could not hold and the market gave in to more selling.
Although the market has been very volatile, we finished another good month, not to mention the additional winning trades in the Trading Room.
For the week, the Dow actually closed up +141.9 points; SPX slid 5.01 points; Nasdaq sank 67.83 points. Gold was down, but, still finished in the $1600s. Oil went below $80/barrel. At the time of this writing, Asian markets were down. Here's where the US market stands after Friday's close:
On Friday, SPX fell 28.98 points to close at 1131.42. Its daily MAs and MACD moved lower.
Nasdaq dropped 65.36 points to close at 2415.4. Its daily MAs and MACD also went down.
Both SPX and Nasdaq closed below their respective daily MAs, but, managed to stay above the recent lows. For the new week...
To read the rest of this article, please subscribe to HappyTrading "Premium Articles" by going to the Premium Services (click here) page. If you are already a subscriber, please click here: Market Forecast 10/2/11.