Stocks have reached the critical juncture of 3320, where the bulls better mount a rebound. While tech is acting weak, semiconductors continue to relatively outperform, while in the credit markets, HYG ETF is holding up great, while quality debt instruments are marginally higher.

In the last two hours of today's session a snapback SPX rally is still entirely possible, with the target for the bulls at around 3340, which would result in a favorable candle and volume combination, conducive to the Monday's upswing possibility.

I have also received a question as to what I mean by the sizable lower knot on the September monthly chart (text taken from today's regular Stock Regular Alert). By sizable lower knot, I mean that prices would come back to the 3450 area at least, not that they would plunge even more, and then come back to lower than 3450 levels. Right now at 3320, it's precarious for the bulls in the short run, absolutely. See above for what would be the bullish outcome here.

Thank you and have a nice weekend.

Monica Kingsley
Stock Trading Strategist
Sunshine Profits: Analysis. Care. Profits.