SPY Testing 100DMA, Is Correction Pricing In Soft Patch Or Just Market Dynamics (SPY, DIA, RBA Leaves Cash Rate, AUD/JPY, AUD/USD, US ISM, FXI, SSEC)

This is a continuation from my previous post about the March S&P E-mini future testing its 100 day moving average.  The e-mini right now is trading just above the 100DMA (1081.68) at 1083.25. It is down 2 points or 0-.18%.  Below is trend and 100dma analysis on the S&P ETF ($SPY) and Dow ETF ($DIA) with charts.  Tonight the Reserve Bank of Australia kept its cash rate unchanged at 3.75%. Economists were expecting 25bps according to the Sydney Morning Herald. AUD/JPY just died in a sea of red, down 1.21% to 79.92.  AUD/USD followed (chart below).  Today we also saw decent US ISM numbers ("ISM hits 58.4%, best since Aug. '04" - MarketWatch).  If I recall, China's December PMI hit its highest level since 2004 and a few weeks later the Shanghai Composite and $FXI (China ETF) both were under their 200 day moving average!  Were we just massively overbought or are these corrections pricing in a global soft patch?

SPY is currently testing 100DMA resistance in an immediate term downtrend channel but is riding a longer term uptrend.  The immediate term downtrend and longer term uptrend will force SPY to make a decision at some point.   107.23 is the next support level if it rolls over.  DIA is right on channel support and just above the 100DMA.

DIA 1 Year Chart (Courtesy of FreeStockCharts.com)

SPY (SPDRs S&P 500 ETF) 6 Month Chart


AUD/USD After RBA Announcement, BOOM

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