S&P 500 Drops through Support

The S&P 500 was attempting to hold near the low formed last week that came on the heels of the post-election collapse in the US stock markets.

It just so happens that the low was in the very near vicinity to the critical 50% Fibonacci Retracement Level of the entire rally of the late May/early June swing low.

It bounced away from that level yesterday but today, down it went.

The index is now poised to drop all the way to the next Fibonacci retracement level, the 61.8% level, or the 1340-1344 region.

Failing to hold there, it should retrace the entirety of the rally meaning that we could very well be looking at a drop through the 1300 level on down towards 1275 or lower.

The onus is now on the bulls to hold the next level of support at 1340 if they have any chance of regaining the near term advantage, which clearly lies with the bears.