With the market quite extended and at key resistance, a pullback was to be expected, and that's what we got today on Wall Street. Stocks started the day only slightly lower but sold off further in the first half hour of trading. They moved sideways from there through lunch and into the afternoon, but fell a bit further after 2:00 and finished near their lows for the day. Volume, however, looks to be a good bit lower so that is a positive(at least on the S&P).
Technically, no real damage was done from what I can see today and as I discussed in yesterday's video, a pullback here is normal and very healthy. A gap up and further gains were probably the worst thing that could have happened today in terms of this rally lasting a long time. Today's pullback (which could go a few more days) will allow the market to catch its breath and regain the necessary strength it will need to climb over its declining tops from April.
Key support now rests around 1080 for the S&P where both the 50 day and 9 day moving averages are converging. For the Nasdaq, the 50 day is a bit above 2200 and that level holding would be very bullish. It may not happen, however, and a pullback to the short-term moving averages around 2185 would likely still be OK in the grand scheme of things. Much further than that and maybe the outlook changes a bit. As of now, I am still bullish and will look to enter long opportunities as they present themselves over the next few days.
That's about it for now - no damage done today and the numbers remain bullish. Buy opportunities may present themselves over the next few days. Good luck Tuesday.