SPX Daily Chart: Downtrend Continues

The SPX Daily Chart has formed a descending channel over the last 21 trading sessions and today the SPX tested but held the lower channel line. The bottoming tail candle that was formed today could be construed as bullish, but we'll have to see how Friday closes to see if that bullishness is confirmed. If we do close above today's high then it's a feather for the bulls, but in the bigger picture, the SPX has already confirmed a lower high and a lower low on the daily so the general bias remains bearish.

The SPX has spent the last 2 days under the 200MA which also adds a bearish tone to the index. We'll wait to see what tomorrow brings us, but watch those channel lines as they're likely to be a trading range over the next few weeks. Any close above or below those lines should be watched carefully. It's important to wait for the close as illustrated by todays action. Many intraday sell offs of today's magnitude can reverse in afternoon sessions to find key support areas like it did today.

SPX Daily Chart