Gap Not Filled

The Dow jones industrial average was down 135 points calling for the ETF SPY gap to be filled at the 210.02 level. The print low 210.21, 19 cents above the gap. This gap is calling for a market pullback on S&P futures between 2905 and 2105. The print low on S&P futures was 2096, the gap on SPY correspond with about 2 S&P handles and the print low should have been around 2094. Once we got the pullback the market reversed and shot right back up above the 2120 level, however I believe this is just an oversold bounce and that the gap will be filled. I am not bullish here. If the Dow gets to between 18100 and 18500 as a long term investor I would be looking to sell and go to cash. At 2:30 I had a buy signal on the 15 minute time frame on S&P futures which propped the market up about 6 or 7 handles towards the end of the day, erasing most of the losses of the day. It still closed down and the advance decline was still weak near the close. We may have some early morning strength but I don’t think it is going to last and I believe by Monday at the latest the market will start heading back down. Crude oil dropped to the 56.51 level. The key level is 55.69. If the price fall below and closes below this level crude is going lower, probably to the high mid 40s. Oil bounced off the 56.51 level and shot back up to near 58 right near the close. Again, a lot of backing and filling .Oil is doing what it can to hold above the 55.69 range . There are no clear patterns on oil. Even though oil was up on the day a lot of oil stocks were actually down on the day. There are a lot of divergences here, including stocks like Sanchez Energy (SN). Stocks were down pretty heavy across the board even while oil inched up near the close. I see no clear patterns on Gold. The dollar is showing signs of strength, however gold is in no man’s land. I’ve had a lot of great calls on gold in the prior week but now I am just waiting. A great trade is developing on the dollar yen. I have a significant buy signal for the dollar yen on the daily charts. The dollar yen traded as high as the mid 124 range before pulling back today. It is still slightly up on the day but I am seeing is a great pattern on the daily charts. I am looking for a pullback somewhere around the 121.5-122.5 range in the next 1-5 days. If I get that pullback the next target is the 124.5-126 range


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