We have hit a pivotal time in the stock market. This market needs to correct, and there is a strong chance it is happening right now and will unfold over the coming weeks.

The pair broke below the trend line, and had a strong bearish close the day following. RSI also did not confirm the last move higher

A likely target for the short is the 50% retracement level which also corresponds to an old support level at 820.

880 is the closest major support level, a close below that point to a test of 820.

Cory Mitchell, CMT

While the day today finished higher, it is was on declining volume which favors the short side.

Today saw further declines, at least at the time when I am writing this with 30 mins left to go.

While today was weak, it is quite possible we won't see very aggressive selling until after the end of the month. Stock prices will try to be propped up for the quarter end.

Either way, I believe this market is heading lower. Many other global markets are confirming, as well as Fedex which is often a market leader - and it just broke support.

Cory Mitchell, CMT

Rally today, but still below the trend line and below intermediate resistance at 931 on the S&P.

As mentioned prior, strong selling, if it is to occur, will not likely have sustained pressure until after the end of the month. If the market is going to correct significantly, this is likely when it will happen.

Cory Mitchell, CMT

Today's rally is likely to spark some optimism that we are once again heading higher. Buying right now is a dangerous thing. If you are bullish it is worth it to wait for a break to new highs if it occurs (close>957). The odds of this is much lower than the chances of a decline.

I warned that the market was likely to hold up pretty well till the end of the month, and so far it is has done that. It is highly likely we will see a strong correction as we start July. This does not mean plow short. It means wait for the signals on the short side. From the lines on the chart you can see where the a few possible entries are, as well as stop levels if the market does in fact move down.

The initial target for the market on the downside is 820-800.

Got questions or comments...post them

~Cory Mitchell, CMT

Monday could be an interesting tale. With the holiday gone we will see if Thursday was the real deal. Volume was low, and yet things still set up a further correction. This range could hold a little longer, but it will still eventually break. Initial targets are still as above.

The average true range is about 17 which puts the 888.86 low in play for Monday. A close below that level would confirm a break. 880 area might put up a little fight whenever it is tested over the coming days, but will likely not hold for too long once prices start falling.

Cory Mitchell, CMT

The market has held up well, but volume is far less right now than it was on the trend up. We are not seeing the same push on these moves higher as we did before. This still indicates to me the market is heading lower over the next couple months.

We could still get up into the 930 area on a last ditch effort to squeeze out some early shorts. But if volume does not pick up on the buy side soon, prices will start to fall under their own weight and the current technical picture will star to play out.

Cory Mitchell, CMT

Rallied right into the 930 area mentioned yesterday. Resistance is likely but we did close almost right on the highs so further pressure could be seen if we open higher. But whether that upward pressure can be sustained will tell a lot about the direction this market is likely to go over the next while.

There is now a possibility that the breakout downwards was a bear trap. This would be confirmed by a close above 950. A break above 950 would target 1000.

Cory Mitchell, CMT

The bear trap (false downside break) has been confirmed - on July 20 was the original trigger. The two days following that and then today's push strongly indicate a swing higher. Initial target is 1000 and then 1020.