Rolling on the floor.

A couple of charts this morning to show what may be a new leg down.

S&P 500
DOW
In the case of both the DOW and the S&P we see the market is more and more comfortable at their former floor levels. For the DOW, 8000 is violated with regularity and ventures above the 50DMA are quickly squashed. The S&P 500 is a bit more resilient but still digging away at its floor.

Indications are we will test the November lows before long. If history is any guide this next leg will be less a violent plunge and more of a slow bleed. The Fibonacci Fan illuminates some possibilities should a new leg commence. A touch of 560 seems plausible, however I suspect this is too much too soon. 765 looks more reasonable.



Key to this theory is the 50DMA for the big three. The Dow and the S&P haven't sustained more than a quick peek above their 50 DMA . The Nasdaq (not shown), while stronger, looks tenuous and lends little credence to a sustainable rally. More bleeding seems inevitable.