Keep an eye on the channel we’ve been charting since Tuesday. If SPX breaks out, it’s time to take an interim long position.
UPDATE: 10:00 AM
Things are happening faster than I can type this morning. We just reached the white channel midline and are still going strong. I’ll set stops here and see if we can reach the purple .25 line at 1563.40. Charts in a few…
UPDATE: 10:12 AM
Almost reached the .25 line and immediately backed off, triggering stops on my long position at 1561.45. Reverting to full short.
UPDATE: 10:45 AM
Here’s the chart I’ve been focused on this morning. Even with all the whipsawing, the 60-min RSI shows a likely move lower to tag the bottom of the big white channel. The reversal at 1562.60 came in slightly higher than the midline.
But, as the chart shows, many of the reversals have missed a precise midline tag — making reading RSI channels equal parts science and hermeticism. Remember, each data point happens on the hour, so the current blip lower than the midline could reverse itself and turn higher in the next 20 minutes.
Seeing some support at the (new) proposed channel midline. Stops at 1561.50ish.
I’ve had several questions about whether the push lower than our original 1560 target busts our leading forecast. Many hours of charting later… I don’t think so. Once SPX broke through 1560, we targeted 1549 — which we came every close to tagging yesterday (1549.80.)
I had no objection to taking the 23-pt profit, but I think there’s more where that came from.
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