The S&P 500 is moving lower since peaking last Wednesday. A key tool to track the downtrend is the retracement tool. In this case, we are tracking the retracement on the S&P 500 from the February low to the September high.
There are four retracement levels. The first is the 38.2% retracement which on the S&P 500 is 2784.97. The second level is the 50% retracement which is 2736.80. The third level is the 61.80% retracement which is 2688.63.
Currently, the S&P 500 has again broken the 50% level. This action indicates that a 61.80% retracement could be in play here as we are below the 50% level. Then worst case the 100% retracement at 2532.69.
Yesterday on a intraday basis the S&P 500 got as low at 2722. A move to the February low would probably conclude the downside action unless the S&P 500 just slices through this level which seems unlikely. Pay attention.
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