The flash crash caused major damage to the rally. Please note that market sentiment has been changed. Retail investors got burned 3 times in past decade once in 2000 then in 2008 and they got the final shot in the head in May 6th, when market drop near 9% in matter of minutes. The flash crash is going to push them away from stock market for a while.Here is my forecast for coming days. I give only 5% chance for S&P500 rallies to 1150. If S&P could get above 1150 and stays above it for 3 days bulls could argue that this rally is not dead. We shall find out soon.
If S&P500 drops to 1110-1105 there is 10% chance of rally. I think S&P is going to tank to 1065 in coming days, there is 55% chance that it would break the May 6th low and heads for 1052-1042 level. If S&P reaches the 1065 there is 30% chance that we get a bounce back. Note any rally would be an opportunity to sell, and please don't try to be a superhero, DO NOT BUY THE DIPS. You are going to get crushed.
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