Europe is down solidly today with impulsive looking declines, and S&P futures have followed. The latter are bouncing currently, but staying below ES 1515.50 will keep the pressure on.
Yesterday was another weak high with weak internals and a rising VIX. Should the S&P cash get above 1520.99 without making another new low first, there may still be another chance at a new high. It will have formed a three-wave decline in my view, which is corrective in Elliott terms.
But by stopping short of 1520.99 yesterday afternoon, the market has the opportunity to make a new low below 1515.93 first. The futures have already accomplished this overnight.
The 1514 area is the 38% Fibonacci level which should provide some support, however, as I've said, I'd prefer to see 1508-1510. The stop remains 1498.49. Below 1505 would be an early warning signal.
I still want to be long for what I see as another possible rally to a new high. But I will likely be much more aggressive with shorts there than I have been since the start of the New Year.
Today is yet another example of bifurcated social mood. I just wrote about this the other day in The Continuing Bifurcation Of Social Mood. It seems to be accelerating.
Today we have a skyscraper alert in Los Angeles for the tallest building on the West Coast. But it gets better; it's not even an office building. It's a $1 billion hotel. Better still, the builders aren't Americans, but Koreans. Korean Airlines to be exact.
From a socionomics sense, this is a signal inside a signal inside a signal inside a signal.
Edward R. Dewey popularized the skyscraper indicator back in the 1940s, and found that plans to build a new record-setting skyscraper often start near the end of bull markets, when optimism is at its highest. Being a hotel indicates an emphasis on leisure over businesses. It suggests a burgeoning shift in the balance of power from East to West in America based on a larger global shift from West to East. Yet it's Korean instead of Chinese, and an airline no less. A smaller Asian country on the quiet ascent, flying high literally and figuratively.
That's the bullish news today. On the other side, it's getting disturbing. Defecation and death at Australian art museum reveals:
Eccentric Australian gambler David Walsh is shaking up the sleepy city of Hobart with an unorthodox new museum challenging visitors to a new pact with fermenting, defecating and dying art.
If this is not indicative of falling social mood, I don't know what is. Robert Prechter, the founding father of socionomics, cautions us to be on the lookout for such disturbing trends to continue to worsen in art and film as social mood turns darker. If things are this offensive now, imagine how disturbing they might be at the end of a long and drawn out bear market.