On the SP500 on Wednesday - we saw the biggest fall -1.47% of...

On the SP500 on Wednesday - we saw the biggest fall -1.47% of the November/December rally. In fact, it was the biggest fall in the last 100 Days - around five months. (I didn't search back more than that.)

On heavy volume - that's a very bearish signal.

Thursday/Friday clawed back a little of the Wednesday loss, but the 10/1 Supertrend line held the advance (resistance).

Supertrends show two blue lines and one yellow line. Mixed colours = possible trend change.

Thursday/Friday could be a bear flag.

If we see a break below the low of Wednesday's big down day - we'll have completed lower low and lower high. The start of a new down trend.

It would be unusual for a down-trend to start during the Santa Rally. (According to "Fprbes", the Santa Rally spans the last five trading days of December and the first two trading days of January.)

But anything is possible on the stock market.

Given all the other signs that this rally could be on its last legs (e.g., excessive optimism, overbought on the RSI, XJO overbought on Pitchfork), there's a good chance we will see some downside. The way the last three days on the SP500 have played out - I think it is looking increasingly likely.