In yesterday’s regular session the S&P500 closed almost flat having found support on the -1ATR line on a daily chart, states Ian Murphy of MurphyTrading.com.

In fact, that was the fifth day in a row buyers stepped in and halted the decline at that level. As the saying goes, “Prices can fall under their own weight, but it takes buying to drive prices up.”

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It’s too early to say if selling pressure has eased and the pullback is over, but this is exactly the type of pattern that would form if it was. Today’s session, being the last of the week, will tell a lot.

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Drilling down into the stocks, which make up the indices, the Composite Help indicator has ticked back up having bounced off -5%. Unpacking this indicator, we notice the yearly new highs and lows never crossed below zero (magnified) a positive sign, as mentioned in previous notes. In addition, the price bars on the S&P 500 (SPX) have stopped being red, which means the MACDH and moving average are no longer both declining.

So, where does that leave us? We had a pullback, we found support at an established level, and we are on the border line between bullish and bearish zones. US equities are not as bearish as they have been early in the week, but we are not back in the bull ring just yet.

Learn more about Ian Murphy at MurphyTrading.com.