The recent rally in U.S. equities saw the S&P 500 Index, Nasdaq 100 Index, and Russell 2000 Index turn up from our MOB price target bands.
However, these indices are now coming into ellipse sell zones where we could see selling pressure.
I have avoided playing the long side in a big way for the simple reason of not knowing the magnitude and duration of this counter-trend rally. Some last 2-3 days, some 2-3 weeks. The S&P 500 would need to take out the 3910 are with buying pressure to assume a further rally to 4100.
I remain cautious and am looking for another leg lower to take out the June low.
Twitter: @GuyCerundolo
The author or his firm have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
