SPX continued the push lower today, getting close to the 7630 target from yesterday’s post. SPX is now down about 1.75 standard deviations for the week, making it one of the more statistically bearish weeks in a while.

We still have tomorrow to go, however. Friday has been more of a bullish day lately, so tomorrow is definitely a coin toss and could be a day for a slight recovery but that remains to be seen.

The daily chart continues to roll over and now SPX is starting to show some real signs of weakness on the larger timeframe chart. You can see we are well below the lower end of the expected move and the chart is beginning to look like it is pointing straight down. It feels like acceleration is just around the corner and we are due for a huge flush lower.

Regardless, there is nothing bullish about that chart at the moment. That 7630-7600 area seems like a magnet for the time being.

The downward trend I highlighted yesterday continues to play out nearly perfectly, as SPX just about tagged the lower end of the channel today. If this trend holds, then there could be a slight bounce before we continue lower.

If SPX continues to break down and breaks the trend to the downside, then we might get that acceleration I spoke about above.

The market is at a critical cross roads, but I think overall things are pretty bearish. The down move has been slow and steady, which is not something you see too often.

Usually, we like to see V shaped bottoms and right now the first half of the “V” has not occurred. The down move has been quiet and orderly.

Friday might be the saving grace tomorrow, but even that is not a guarantee. I think we are firmly in sell the rip territory, especially if SPX remains below 7700.

Let’s see how the week finishes!

Good luck!