The significant 825 level on the S&P 500 E-Mini futures was breached with strong momentum. Then came the sudden reversal within minutes.

The reversal was extraordinary because of how far below the 825 level the futures dropped. This important and key support had been breached but like magic the futures reversed. I said last night that when the 825 level is reached it would be like one of those battle scenes from ‘Lord of the Rings’. Well it was and the reversal had to be the magic of the wizard Gandalf.

After waiting for the upward move to break above resistance levels to reduce risk I then took a long position in SSO (S&P 500 Ultra). The charts below should be self explanatory.

Tough call here to say if this is the beginning of a bear market rally or not. We have to be quick to respond to sudden moves should they occur. Risk remains VERY high.

Even if a bear market rally ensues it has no impact on the long term projections of the market. Long term remains solidly bearish.

 

 

 

 

 

 

 

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