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Here Are The Current Support and Resistance Points for the Stock Market – Mike Swanson (10/29/2018)

We have seen some wild swings in the stock market over the past few weeks and it’s easy to be confused by the daily moves.  And really the news just focuses on the stories of the day and not the big picture.  So this week they will be talking about Apple earnings Thursday after the close and Facebook after tomorrow’s close while we can expect the market to gyrate wildly.

But there are some clear resistance and support levels on the S&P 500 that are materializing that can help guide your trading this week.

An hourly chart makes the action clear.

The S&P 500 is in a clear downtrend now when you look at the hourly chart.

We can now draw a downtrend resistance line connecting its recent highs.

As you can see right now this line shows that resistance is at the 2720 level for the S&P 500 and by the end of the week will be at 2700.

So if we can get a wonder rally day this week look for the 2700-2720 area to act as stiff resistance.

I don’t know if that will happen though as the selling is so intense now when it comes and we couldn’t get a rally that strong last week.

At the same time current critical support beyond last week’s low is going to be in the 2600 area.

I also think we’d probably see a bounce above support before the market would go through it.

Now everyone is looking for a bottom and for the decline to end, but as I explained last week there will no be real end to this drop until there is a real panic washout in the stock market.

It’s going to take a break of the lows of the spring to make that happen and it is likely to become very ugly once it does.

The problem is everyone is for the most part still bullish and complacent and any up movement is causing some people to buy in expectation that a big rally is starting.  That’s why the VIX is depressed despite the action.  It actually went down on Friday even though the stock market dumped.

Last week I did a post and video explaining what it takes to make a real stock market bottom.  I did that knowing that the market would likely gap up and rally the next day and it did.  But I knew such a rally would just be a fake-out just as any moves this week like that will be too and that’s why I did the video.  That post and video explain WHY and it applies now more than ever.  If you missed it watch it by going here:

Here Is When The Real Stock Market Bottom Will Come (Not Today) – Mike Swanson (10/25/2018)

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