Watch This Technical Support Level

If we break below SPY $390 we will test the low of the year.

PRE-OPEN MARKET COMMENTS WEDNESDAY – The massive decline yesterday put the SPY within striking distance of an upward sloping trendline and horizontal support at $390. That is a critical level to watch. The CPI came in hotter than expected and we are not seeing much of a bounce this morning after a relatively mild PPI. Support at $390 was defended last week. If it fails we are likely to test the low of the year and there will be plenty of nervous jitters ahead of the Fed rate hike next week.

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