Today both hourly and daily S&P cycles were down - a consolidation was expected. However, the extent of decline with an uptrending medium term weekly cycle was a surprise. Futures declined almost straight down to close at 2806. The bearish engulfing daily candle as well as weekly net loss indicate more down side is in the works next week until both hourly and daily cycles bottom.
The daily buy signal on US Dollar Index brought further gains - it went as high as 96.29 closing at 96.10.
On economic front, the deterioration continues. Manufacturing and services PMI declined to 52.5 and 54.8 respectively - the composite level dropped to 54.3. Existing home sales jumped by 11.8% and supply was up by 2.5%, supply to sales dropped by 3.5 months. Wholesale inventories went high by 1.2% m/m in January and up by 7.7% y/y - inventory overhang continues.