Hi All!

The major averages came under very serious pressure this afternoon and shredded through support levels we thought would take longer to reach.  Things closed very ugly and near the lows of the day.  We opted for a chart of the DOW since the major indices are all fairly correlated and this chart is a clean one in which to see the obvious support levels below.

In the webinar today, we discussed the candles becoming larger as the selloff picks up pace.  That happened quickly and without some kind of news to buoy it, it wouldn’t be likely that the market would act as if nothing happened by tomorrow morning.

A drop to the first gap closure would now seem to be much more likely than just a few hours ago!  We’ve covered the Rising Wedge for so long thinking it could matter and we must still do so because the fallout from a break like this can take us all the way back to the start of the wedge formation which resides much lower.  This remains a time to roll aggressively.

For those that may have elected to take the SYY bear idea from this week, here’s a look for you:

For those that kept rolling down with last week’s bears, here’s an update on each:

OKTA fell another 7% today and the next clear support level may be a full $6.00 near $49.00 if it remains in free fall.

RTH finally made it to our lower level target of $106.00ish today and could drop almost $3.00 more to find the next support level at $103.00.

GT finally reached our lowest target level of $20.80 today and so we must note that the next one down is $18.90ish.

And finally, lo and behold, PFE finally weakened.  It closed right near the 10 SMA and the 20 SMA lies just below.  It never triggered last week but if it breaks we’ll keep an eye one it.

Cordially,

Wayne