• There were no surprises from Fed Chairman Powell this morning. We had to manage our stop actively in the volatility, but yesterday’s swing buy signal gripped nicely, and the volume was terrific on today’s follow-through rally. 
• The rally is still guilty until proven innocent – judged a short-covering (Gamma squeeze) bear reflex rally.
• The next resistance cluster is 4040 to 4050. Support lies from 3988 to 4005. A close at or above resistance is bullish and below support bearish. Generally, closes above 4100 are bullish. The zone from 3900 to 4000 is neutral. Price acceptance below 3900 is bearish.
• Watch the price/volume relationship carefully. Keep an eye on Junk Bonds (JNK) to confirm the S&P 500 rally. JNK led the rally and likely will lead the next decline. Reference the table above for signposts inside the clusters.
• I still believe the market will dip into the Hurst Nominal 80-day cycle low, coinciding with quarterly/monthly expiration and the Fed meeting (9/16 and 9/21, respectively). The dip does not necessarily forecast a new low (below 9/7 at 3883.50). 
• Price could retest or come in higher. Retests are common a week after a new low. We will keep our rally expectations conservative in the circumstances and continue to move stops up to preserve gains. For non-subscribers – the 5-day EMA line is a good stop reference.
• We continue to keep a close eye on the 10-year treasury rate. The US Dollar finally stalled, likely helping the stock rally.
• Price bullishly closed above the Navigator Algo trigger line today.
• Until otherwise indicated, the market is in its third wave down, arguably the cruelest leg of any bear market. The rally is likely a bear retracement rather than a new bull. The alternate thesis calls for a trading range, and Thursday’s low could be in the bottom of the range.
• What if this is THE bottom? Nobody expects the bear to end here, which is why it could. Time will tell.
• Negative Gamma pressure persists below 4000.
• Tomorrow’s target is to reevaluate when the market tags 4040-4050. We will closely manage our stops.

A.F. Thornton