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SPX setting up for new leg lower?

jeffriess
February 3, 2020
by Joseph Jeffriess, Market Analyst

Sellers close to a new extension lower.

Traders, looking at the current daily SPX500 chart we can see price sitting at crossroads after a strong bearish move.

Overall price remains in a long-term uptrend, we’re focusing on the current medium and short term price action. Friday’s session produced a piercing move lower that confirmed a new lower high (LH) price has stopped at a support point but is currently finding resistance at last weeks short-term support level. Will we see a continuation lower? Sellers need to reverse today’s rally or break the lower support and low set last Friday. If confirmed this could set up a new continuation of the current short to medium downtrend. If buyers can hold support this could set up a new consolidation.

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