SPX appears to be struggling below yesterday’s close in the Premarket. Although anything can happen with HFTs, we may expect to see a resumption of the decline below the Cycle Bottom at 2007.99. Chinese intervention in their market failed to break the rout in the overnight markets.

ZeroHedge reports, “Weakness in Breadth, volume, sentiment, and momentum all lead BofAML to warn "sell rallies" in stocks. Starting 2016 under pressure, the S&P 500 has big support at 1994-1990 but 1965 is the level at which things become perilous. Simply put, holding 1965 is required if a 'bounce' like late 2011 is expected.

S&P 500: 1990-1965 is the big support to start 2016”

TNX is down this morning, but not beneath its 50-day Moving Average. A drop beneath it will confirm that the decline is resuming.

USD appears to be completing a Minor Wave 2 this morning, but having little effect on USD/JPY. That suggests there is little benefit to liquidity in this morning’s market.

Regards,

Tony

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