The stock market had a pretty wild day; it was a tale of two trading sessions. The morning was pretty ugly, with sellers coming in at 7 AM, knocking the futures down. The afternoon was a straight melt higher. Very hard to determine if today was a turning point in the market or not. Based on the outside factors like the dollar, yields, and commodities, the market’s direction should still be lower.

Today’s rally felt like big implied volatility, short-covering rally that started at 2:30 PM when the VIX started to drop, giving the S&P 500 a massive boost into the close. However, the rally stopped right where it was supposed to at 3,920 and turned slightly lower going into the close. I have extended my drawing and marks from the chart yesterday to include a 5 wave count lower. If the count is right, then today’s rally will be retraced lower, and today’s low is also likely to be taken out. It doesn’t mean tomorrow but in the days ahead.

To have come all this way and to not fill the gap at 3,830 would seem strange. Again, that doesn’t mean it has to happen tomorrow, but I do think that is likely to happen.

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The call volume was in line with yesterday’s, so it did not see a jump despite the big bounce-back in the equity market. The S&P 500 will struggle to rise if the momentum from call activity doesn’t return soon.

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Apple (AAPL)

Apple had a good day, but the chart looks terrible on the Intraday, and I think it will still fill that gap down at $116.

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Square (SQ)

Square keeps knocking on the $200 door but won’t go through it. Everything about the chart suggests it does go lower. I don’t know when.

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Amazon (AMZN)

I also still think Amazon is going lower to $2,670.

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