S&P 500 - Nov 6, 2008

charts courtesy of stockcharts.com

I can sum it up in one word: Dump-O-Rama!

The urgency with which people sell is astounding.

Two back-to-back high distribution days are not really good news. But they create oversold conditions, from which a bounce may arise.


S&P has retraced 62% of the prior advance. Yesterday, it stopped at 38% retracement, today at 62%. You think this is by mere coincidence that the cliff hanger goes to intermission at widely traded Fibonacci levels?

If my count below is correct, we are close to a wave complete, a quick burst down, maybe, before a bounce.

Index dropped below the 912 level. Needs to regain that level and hold it during the next bounce, otherwise, we may be headed for the neighbourhood of the 850 level.