It's too early to tell if the expected massive wave down will be triggered by the "no big deal" CPI Report for December. Inflation came in "as expected" whatever that means, so at least we can now get back to pattern recognition and key level analysis to guide trading. Let's do so the Dow, S&P and Nasdaq key levels which if broken ( especially on a closing basis) would be compelling evidence that the bears are back in control. DJI A breakdown below the horizontal red support line at 34,222 sets off a slew of bells and warnings that the most recent Wave 2 counter-trend rally has topped. That would imply, suggest, forecast, and all but seal the case that a Wave 3 down at multiple degrees of trend has begun. This would finally allow for some aggressive "all-in" trading on the short side and would suggest same across all major averages. The DJIA as been the strongest index of late so its coming over to the dark side has a significant implication for all indices, stocks and ETF's. SPX The same analysis applies to SPX, it's Key Level now at 3880. QQQ The 260 level on QQQ remains key to its future. A close below 260 triggers new QQQ puts and/or SQQQ calls.
