Major Resistance at the Gap
Update on the SPY's one year gap ...
It was just a little over 1 year ago, October 3rd. of 2008, when the SPY gapped down sharply. That gapped remained open until October 15th when it was finally closed.
That gap was also a major resistance level to reckon with. So, what has happened since October 15th?
The SPY has NOT been able to move past the 109.68 level.
As time moves on, the odds for moving past that level have been diminishing.
Why? Because our C-RSI (market strength) has not only been negatively divergent, it has also been dropping lower. (Last Monday, we commented that "Negative divergences are warning signs" and that has NOT changed.)