Market Update

Market has been very weak lately. Bulls had a brief rebound from Friday afternoon to the first 20 minutes of Monday morning but quickly gave back most of the gains. At this stage, any further down move will violate major support of the market.

The spdr SPY is in a falling wedge. Until the upper trend line is broken, it continues to be in a down trend. Small cap IWM is at important support of 60. A break to the downside is extremely bearish. Emerging market EEM is sitting on multiple moving averages. Another 1% drop will break all these MAs to the downside.

If my hypothesis about tomorrow's existing home sales turns out to be right, we could see a very bad day and breakdown of the market in all segments.