The market futures did break above 1266-1267 as I suggested could happen, but failed to hold that and opened red. So the market closed down as expected. I believe the market confirmed that the 20TD cycle topped yesterday (adds faith in my changes last weekend).
With the pullback to 1234 we are now fairly close to the expected level from using the 40TD DPO to guage an appropriate level (7pts x 11 days = 77 pts; 1158 + 77 = 1235). This does not mean the market cannot exceed this level to the downside - but it does suggest limited downside IMO.
The 20TD cycle showed a burst of strength today as it turned down. So this show of strength has me asking - what is the upside potential from here. It may be fairly limited (60 points or so based on the 40TD DPO over the next 9 days).
Tomorrow is OPEX Friday. We also get the Europe plan for a plan. So it may be an interesting day. I would think any potential upside may occur early in the day (the 40TD, 10TD, 5TD cycles are up.The 2.5TD cycle tops in the morning). The 20TD cycle is down (hard?). So the bias for the entire day should be up - stronger in the morning and weaker later in the day. Fairly volatile due to OPEX. The 50 DMA around 1218 should provide support. So lets say a range of 1218 to 1250 tomorrow.
Here is my interpretation of the SPX swing cycles:
OPEX is next Friday....although we have weeklies expiring today.
ReplyDeleteShadow - oops, my bad.
ReplyDeleteI was hoping for a gap down this morning, but so such luck.
ReplyDeletePhil Davis was short term bullish today, but claims he will take profits today and stay in cash over the weekend. He feels that the EU agreement will not stand up to weekend scrutiny.
From my "tours 'round the net", it seems that most are still expecting a year end rally. Some feel that the S&P could fall to 1194'ish and then rally.
So, I am waiting patiently for an opportunity. Maybe we won't fall all that way, but I would like to see more of a pullback.