Stock Markets Update 6-27-11

I commence with my gratitude to The All-Knower

Markets rallied today. However, it was lackluster, with any commitment of big buyers. The rally was actually a “ball bouncing off (the last bounce)” the 200-days MA, very last time, before it dropped in a water-fall fashion.
I have previously published and showed you the use of 3-days charts, it was Gann’s the most favorite swing chart to determine the direction of trend. According to the 3-days chart theory, (like other charts), recent swing has to be taken out in a 3-days chart, before a trend-reversal in confirmed [Market has to take out (and stay above) the June 22nd high (in some cases, 06/23 high to reverse the trend.]

All of the recent rallied occurred on thin volume, especially today’s. Which usually big boys use to sell last time at better prices, before the market is dropped again. Please look at the enclosed SPX chart , it clearly shows that Selling pressure always exceeded the buying and the last “down red bar” engulfed the previous green bar.  Now if you look at the hourly chart of SPY, the S&P ETF, it clearly indicates that the gap has created a big resistance.

Now please look at the NYSE Composite Index hourly chart it shows a “divergence in selling pressure at equal prices”,  which also, foretells that more selling is coming. Also look at the 2 hourly chart of NYSE, it also confirms that more selling is on its way, before a bottom can be put in.