SPX: Distribution with 33% Downside Potential to $2300

Thursday and Friday was a roller coaster ride. If you told me last week we would have two days where we would go down 5% on the NASDAQ I wouldn't believe you but it happened. Overall the price action is not too bad since it only erased 1 week of gains. This means people who have been holding since April or even two weeks ago are doing just fine. The problem is that it seems fine right now but when you look at history, which you see with all the marked up balloons usually when a distribution day (red or yellow balloon) comes things get rocky for about the next month. The Green and blue balloons are good signs. It could go sideways and it could go down or even up I don't know but only time will tell. Right now there seems to be more power to the downside but it is 50/50. Here is the individual stocks price action in regards to the 10 Week Moving Average:

Leaders that closed below their 10WMA (Sell Signal)
DXCM
TWLO
NASDAQ:COUP
ETSY

Leaders finding Support
SQ
RH
VEEV

Leaders still Leading
TSLA
AAPL
AMZN

So all the big name leaders, which hedge funds own are in a mixed bag. This is not something I would like to see. I and probably you would like to see all the stocks going up and up with the indexes going higher. The big negative is the price action, which is why for my negative sentiment. The price jumped off the 10WMA in a spectacular fashion but it didn't go up enough. The price on the weekly chart needed just a little bit higher like $50 to hit the 38% support level but it didn't make it. It only hit the 32% on the S&P and 36% on the NASDAQ, which is disappointing to see. Since price is the final vote it means that the big money has said this is the beginning of the end of this run but only time will tell.

Potential price target are $3272 (4.5%), $2865(14%), $2538(16%), and $2300(33%) because there were gap ups (Daily Chart) at this range and most gap up tend to be filled. We shall see where the market takes us.

Comment:

Continuing downward action. Positive about today was that volume was lower than the day before but still above average volume for the index.