On Friday, July 26, I wrote:
[I]f bears can sustain a breakdown at yesterday's low, things are going to start to look bleaker for bulls. Worth noting that yesterday's bounce sure felt like a short-covering rally.
I think we can now say with complete confidence that the noted bounce was indeed a short-covering rally, since futures are set to open with SPX down 53,000 points. Futures actually captured both of my downside target zones in the overnight:
Bigger picture, here's where we are currently:
COMPQ also confirmed my read of it from July 31:
In conclusion, it remains entirely possible that we're witnessing the death of the bull market, but there are still some technical hurdles bears need to claim to add confidence to that idea. Keeping both sides of the trade in mind for now: The most bullish case would be that the current decline is wave C of an ABC, in which case the market could bottom directly. Trade safe.
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