Here the Level Where We're Sellers

FSLR and GE have a setup to watch.

Technical Edge — 

• NYSE Breadth: 27% Upside Volume

• Advance/Decline: 26% Advance

• VIX: ~$26

The tough part about right now? The market is trying to re-price everything vs. where we were just a few days ago. Bond yields have gyrated considerably, with the 10-year yield down 15% in three days, the VIX jumped 50%, and we’ve gone from a strong likelihood for a 50 basis point interest rate hike next week to a 25% chance we’ll see no rate hike at all. 

Taken all together and the S&P has actually held up okay. Still, it’s a lot of weight to bear and being tactical is likely our best approach for the time being. Remember, the index is below all of its major daily moving average and the VIX rip is not exactly begging us to get on margin and take a shot somewhere. 

Mostly in-line CPI results have the market a bit mixed in terms of what it wants to do, so let’s look at our levels and see how the S&P does after the open. 

S&P 500 — ES 

Yesterday’s low went down to and barely tagged out 3820 to 3840 support zone, bottoming at 3839.25 and bouncing higher. So far, the ES doesn’t know what to make of the mostly in-line CPI report. 

However, I do know this: 3920 remains relevant, while 3947 to 3960 is a monster level. 

In that zone we have the 50% retracement from this week’s low to last week’s high, the 200-day and 10-day moving averages and the February low. I would be a seller in that zone. If we’re wrong, we’ll know quickly enough. 

On the downside, 3880 to 3890 is carving out a decent support zone. That’s last week’s low, Monday’s close and today’s Globex low. 

Below 3880 and failure to regain it puts yesterday’s low back in play. 

SPY