The State of the Trend
Last week we mentioned the importance of the 1450 level, and that a break below would signal a short-term trend reversal. That level was broken on Tuesday, and later acted as resistance on Thursday. Therefore, we'll continue to keep a close eye on 1450 next week as well:
The weekly support zone comes at 1423-1430, which includes a Gann Square of 9 cardinal number, a 25% retracement of the recent daily range, and the lows following the September 6th QE III anticipation breakout.
Market internals are showing signs of bottoming out, but this needs to be confirmed by price action:
For the time being, the SP500 is following closely the seasonality of the Election Year cycle, which points to a down/sideways move until the end of October: