The $SPY is up slightly today, but there is nothing to get excited about as the trend remains lower. The best case scenario we can hope for is that the market will be able to close back above key levels like the 200 day moving average (128.75) the 38.2% retracement of the Oct 2011 lows to March 2012 high (~129.00) and the VWAP from October through today (~129.46)and prior support between 130-130.50. It seems like a lot to ask of the market to recapture those levels and hope is usually a money losing strategy.

The 30 minute SPY chart on the right shows that we still have a declining 5, 10 and 20 day moving average. It is very difficult for the market to hold onto, and add, to rallies when there is this much downward momentum. The only encouraging action today is that the market is able to stay above the volume weighted average price (VWAP) for the day, so far… Any index longs should be kept to daytrades and with a high level of suspicion.

click chart to expand