SPX acted pretty much according to plan yesterday — getting most of the way to our 2093.55 target before CL and USDJPY panicked and bounced higher into the cash close. From yesterday’s members’ section:
My hunch is that we’ll see SPX decline to our 2093.55 target — particularly if USDJPY declines to flesh out the rising white channel (118.75ish, depending on when) or lower.
It’s a continuation of the theme posted on Monday:
If the past is any indication, SPX isn’t quite ready to make its next major move….l’m looking for SPX to move lower before moving higher, with the likely target being a test of the SMA20.
If 2093.55 fails, then the SMA20 at 2088.3 is the next level of support. That would leave an interesting potential H&S Pattern in place, with the dashed white line representing the SMA20 as the neckline.
updated chart in a few…
UPDATE: 9:37 AM
I think the target will be wherever SPX happens to be when USDJPY reverses and heads higher. Currently, 119.08 looks like the most obvious target. It’s on the thin red TL up from 118.33 and would intersect with the purple .618 Fib.
Note that a full .886 retrace of the rally from last Friday would hit the red target at 118.75 we identified yesterday as appealing. Given that SPX is selling off pretty nicely with a minor downturn overnight, we can only imagine how big an impact that might have.
UPDATE: 9:54 AM
SPX has reached 2090.55 so far. At this point, the neckline is plenty flat enough. And, it has nailed the larger purple channel’s .786 line and very close to the small purple channel’s .236 line.[A drop by CL to 50.17 would help SPX reach our actual target; but, this is probably low enough to get a bounce — at least into the european close. It’s worth keeping an eye on.]
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