After six straight days of gains, the SPY experienced some profit taking on Tuesday. The trendline we obesrved yesterday at 113.75 was violated and found some short term support near 113.20 and also above the more important 112.80-113.00 level which should offer firmer support if the trend continues lower. The short term trend switched to lower yesterday and now we will have to see if the buyers can regain control before we can become aggressive on the long side again. The 5 DMA near 114 should now be short term resistance and if the market can climb back above that level and hold then bulls may breath a little easier.

For more in depth analysis see the video post below which discusses the QQQQ, SPY, XLF, IWM, SMH