The remarkable rally from the mid-October lows has finally hit some turbulence. During that time the S&P rallied over 11% in less than two months, so it's not outlandish for investors to do a little profit taking. We're also seeing another leg down in oil prices, some profit taking on the US Dollar trade, and weakness in overseas markets.
To begin, here's a quick daily chart of the Industrials. We've marched so far into uncharted territory that our first level of major support is near 17,250 - 17,280, about 400 points lower than we're currently trading. Notice in the chart that support at this level comes from a number of factors. That area represents the prior highs in the Industrials (before our last correction), the 38.2% Fibonacci retracement level, and where the 50-day moving average is likely to be in the next few days. From a technical perspective this is a strong floor ... Log in or subscribe to continue reading.