On Friday I noted under my Twitter handle bullet86 that SPY was oversold. So the rebound Monday and today is not unexpected. We are not even remotely close to an extreme overbought condition on a DAILY basis. My rank is a derivation of RSI and the score is 65 and was 28 last Friday. It is proprietary but I do talk about it from time to time at extremes. Above 70 is overbought and below 30 is oversold.
Another key for today’s action is how the Erlanger Value Lines close the day on SPY. A gap open that gets no follow through is NOT good. We have broken back below the 5 minute and one hour lows. Not good. Resistance is down at $143.46 and that could be hit today given the break of the noted ranges. Be careful here if you are a buyer. I would rather be a buyer tomorrow if we can hang strong.