The market started out weak and remained weak all day long. Once again the bears succeeded in taking out another level of support with the S&P closing at 1304 with 1300 now a key level of support. We’ve now got stochastics near 0 and the RSI on the S&P is at 25, almost guaranteeing a bounce at any moment. But, make no mistake about it, the bears are in total charge here, so any bounce could be short lived.

The market started out with promise on Wednesday but as has been the case lately, the bulls were unable to hold the upper hand. Instead, in spite of extreme oversold conditions, the bears were able to take control of the action late in the day, with the S&P moving below yet another level of support at 1326 and closing at 1324. Next up will be 1312 if the bears have their way. The reward to risk remains to the upside here, but try telling that to the bears.

We knew the S&P would struggle if it closed below 1340, and that’s exactly what happened on Tuesday as the bears kept their grip on the market. Now the bulls will be tasked with holding the line at 1326 on the S&P. Should that go, 1312 would be next. To the upside the bulls need to work extra hard to try to recapture 1369, the 20 day moving average on the S&P, if they want to try to turn things around here. We’re very oversold here, so a bounce is certainly a possibility, and wouldn’t surprise us one bit.

We’ve talked a lot lately about the bulls needing to hold the line at 1340 on the S&P and they failed to do so on Monday. Instead, the S&P closed at 1338, with 1326 now becoming the next key level of support. We’re going to get a lot of economic news this morning including retail sales along with earnings reports from some large retailers. We’ll also get a key manufacturing report, so depending on market reaction, we could either continue the march lower or turn things around here. The market is certainly oversold here but trying telling that to the bears who are looking for more blood.

The bulls had no shot to take control early on Friday with JP Morgan‘s bombshell news of trading losses the night before. The S&P got hit right out of the chute but recovered a good chunk of the losses by day’s end, still closing down at 1353. The market continues to struggle here and has been ever since the 20 day moving average on the S&P crossed below the 50 day, and now that gap is widening some. If we get more selling here, it will be critical that the bulls hold 1340, and so far, that has been the case.

The bulls wanted badly to take back the momentum and early in the day on Thursday the market was cooperating. However, as the day progressed, traders decided to unload positions and by the time the market closed the S&P had only gained a few points, not exactly a turnaround day. After the bell Thursday, JP Morgan announced surprising losses which will weigh on Friday’s action, as the market will be tested. Key support on the S&P remains at 1340, so let’s see if that holds.

The bears continued to pound away Wednesday with the bulls mostly defenseless. The S&P got as low as 1343 before bouncing with the market closing at 1354. The 1340 level is now critical support that must be held or we’re going lower. The market remains broken here and unless the S&P can recapture its 20 and 50 day moving averages, the bears will continue to have the edge. So, was that move on Wednesday to 1343 a near term bottom? Might be, so at least stay alert to possible new opportunities, but be ready to remain defensive if that 1340 level goes.

The bears continued to control the action on Tuesday, with the market starting down sharply. The S&P easily cut through support at 1357, getting as low as 1347 before recovering some by day’s end. Technically the market remains in trouble, with 1340 a key level of support. Unless the bulls can recapture 1386, the market will continue to struggle.

The bears had an opportunity to inflict more pain on the bulls Monday but buyers stepped in just in time. Still, the S&P barely budged, leaving it vulnerable here, especially with the 20 and 50 day moving averages both sitting at 1386. The bulls are still tasked with holding the line at 1357 or risking more selling while 1386 will need to be cleared to the upside in order to turn things around.

The bulls were in trouble premaket Friday and it didn’t get any better once the jobs reports numbers were released. Instead, the S&P sold off sharply, cutting through both the 20 and 50 day moving averages before closing at 1369. Barring a quick recovery the next stop will be at 1357, the April 10 low. If the bulls are lucky, the selling will stop there, otherwise, the March 6 low of 1340 could quickly come into play.