We are in the Very Early Stages of the Macro Rollover
Today we are seeing the bounce off the 200 day average after confirmation of the top last week.
There will be a lot of talk about the tariff’s, what they are and what they are not, but the fact remains the macro’s are headed lower and volatility will be very high because of what a piercing of the 200 day would portend.
Technically we are looking at finishing the head of the chart formation with the neckline being in the 2460 area on the S&P. This head formation started in early September 2017 and took 130 calendar days to top out. Down moves tend to be twice as fast, 65 days puts the neckline touch to be around march 31. At that point the January 2532 low will become a ceiling and a new trading range of 2400 to 2520 will evolve. So selling these massive trading bounces remains the focus.
Interest rates and gold moves backup where we are in the cycle. Gold is rising and long term bond interest rates seem to have hit a ceiling. Also the growing possibility that Brexit has a chance of being rescinded will further isolate the US on trade.
Enhanced updates at 1:30 PM CDT
Keep it mind that this is a Macro Event, so the volatility could be high. Before the S&P closes three days under the 200 day, the possibility of a rally to the 2677 level exists.