12.08.2011 -- Resistance held..

As suspected, the resistance was stronger than support and we fell pretty hard today as there was a large air pocket until first support.

We bounced off the mid-bollinger bands, but did close near the low of the day.

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Key Levels

Upside -- 1263, 1303

Downside -- 1229, 1217, 1211, 1196, 1174, 1121

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SPX Daily;

You can see we broke back down into the bollingers and then stopped just at the rising mid-bollingers, but still closed near the low.

Will be interesting to see what happens from here. The 100 and 50dma's are not far below here and at the moment it appears we are holding as that large wedge.

From and EW prespective, we probably have another rally coming to the top of the channel, but that doesn't have to happen. There are possible scenarios which allow us to just tank right here and now.

For now though, unless we break back below all MAs, I will stick with my previously outlined outlook of selling off here and then producing yet another strong rally into year end.

GL

CJ