Good Morning Traders....
So could this be the correction that the market was looking for? Yesterday saw a sharp sell off in most of the global indicies, this morning we have seen a slight bounce from the opening bell but yesterdays move to the downside has to be accounted for and brings with it an element of 'Risk Off' to the marketplace. The move is my opinion was necessary and has been coming due on the back of the significant move to the upside seen since the start of January. It is interesting to note that we are beginning to hear bad news and a negative outlook for European growth re-enter the frame. all of which had been parked away while the January rally was taking place, and traders were making up for lost ground last year.
As previously mentioned in our blogs there are some technical levels that must hold on $SPX for confirmation that up are still in an up trend in the short term, these levels are 1498 and 1496 both should prove as a significant support and resistance. What we have to watch out for as traders is how deep this correction may be, if it is well behaved we should see 1450-1465 and then a move higher but if these levels are breached things may not look so pretty so we will wait and see.
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