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Tuesday, 13 October 2015

SPX Should Really Retest 1995 Today

Yesterday's intraday low was broken at the open so the retrace of the thrust up from the triangle should have started now. The ideal target is 1995 and as that's a match with the weekly pivot on ES I'd expect that to be hit. There is also important support getting close on the 60min chart at the 50 hour MA. That closed yesterday at 1985 and is now at 1987. By the time 1995 is tested it may well be close to that level. SPX currently has open 60min and 15min RSI 14 sell signals so while it's possible that SPX might continue to trade sideways today, there is a lot of pressure to retrace here. SPX 60min chart:
NDX broke declining resistance yesterday which opens up some possible higher targets. NDX also has open 60min and 15min sell signals. NDX is in a perfect rising channel over the last few days, so I'm watching to see whether that channel support holds today. NDX 60min chart:
If we do finally see this retracement to 1995, Stan has today as a possible V day, so it may well bounce straight back up from that test. There is a very decent chance that SPX would then be making the second high of a double top or head on an H&S then, before a hard fail in the next few days.

Monday, 12 October 2015

No Bricks Without Straw

It's hard to develop a pattern structure without meaningful retracements. I have a perfect rising channel on NDX, but am looking skeptically at my best support trendline prospect on SPX, which would currently require a retracement to the 1950 area to confirm channel support. That's an improvement on RUT where I don't currently have any decent prospects at all for a support trendline. We should see a retracement soon to define these support trendlines and I'm surprised that equities managed to build up negative divergence for the majority of last week without that forcing a retracement.

SPX is still on hourly and 15min RSI 14 sell signals, and my best prospect for an SPX pattern here is shown below. SPX 60min chart:
NDX is on an hourly RSI 14 sell signal too now as that fixed on Friday afternoon. Interestingly the high on Friday was also a precise test of declining resistance from the 2015 high, and that's holding so far. NDX 60min chart:
The short term pattern pathway is a thrust from a triangle, followed by a full retracement of the triangle thrust into the 1995 area. The triangle thrust wasn't showing much in the way of signs of life on Friday, and unless that changes this morning I'll be looking for that retracement into the 1995 area, and would note that is a close match with the weekly pivot on ES which I have at 1186 (ES). If that triangle thrust is still AWOL this morning we'll most likely at the least see that retracement today or tomorrow.