As the markets bide time deciding its intentions, the Keltner/Bollinger bands (K/B) are confirming the S&P 500 (SPX) is coiling for a breakout move up or down. It is also showing up on the Nasdaq Composite (COMPQ), and the Dow Industrials (DJI). Since the K/B is on the 4 hour chart, It obviously does not have the same punch as a K/B showing up on the monthly but it is still note worthy. By the way, a monthly K/B is fairly rare and the last time it triggered was July 2012 when the SPX was trading around 1400. The bear market triggers are short in duration 1-2 years but the last bull market trigger was back in 1995 and lasted 5 years before a major reversal.A look at the Japanese index proxy, Japan iShares ETF (EWJ) and Brasil index proxy, Brasil iShares ETF (EWZ). They both have similar themes as they are bounded by solid support and resistance. If the EWJ can produce a TD Buy Setup with a 9 count above the 10.84 TDST support, it will give support to the upside once again. For EWZ, it has been the antithesis of EWJ but the criteria is also clear. The 40 level is support and emphasized by the 41.52 TDST level. For reference, EWJ weekly has just recorded a bearish price flip and the monthly is on a unperfected 9 count TD Sell Setup. The EWZ weekly TD Buy Setup was on a 8 count but interrupted with a bullish price flip last week. The monthly is on a TD Buy Setup bar 4.
Any break above previous high around SPX 1700 or under previous low under 1680 could produce a short term momentum run as suggested by the K/B coiling on the 4 hour chart. For now, there is really nothing to do but wait until tomorrow when Wednesday through Friday are the designated market moving days. (updated intraday)