Thursday, December 26, 2013

A technical update for the mega Santa rally. The last few days are one of the best days to be long during one of the best months to be long in terms of seasonality. Today also begins the first of many DeMark exhaustion periods for all timeframes up to the daily. Judging from the impulsiveness of the markets, there is an even chance for an outright reversal as much as another selloff to relieve overbought conditions. Generally for the short and intermediate charts, the natural SPX support is the breakout level around 1810 and that is supported by a bunch of DeMark confluence zone between 1805.81 and 1809.60. The bulls want to trade above these levels to keep the bullish momentum going. 

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S&P 500 (SPX) SHORT TERM OUTLOOK: BULLISH

Flip to neutral if SPX closes below 1828.50 at the close. ImageImage

The SPX 2 hour chart has recorded a TD Sell Setup @9 and the SPX 4 hour chart is one bar away from a TD Sell Setup completion. If these short term levels begin to matter, then watch the SPX level at SPX 1826.80, the TDST Support levels for short duration timeframes. Trading under this level intraday will suggest buying power is waning. 

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S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BULLISH

Flip to neutral with close below SPX 1809.60.ImageImage

While many of the major indices have a few days left to record their respective daily TD Sell Setups, the Dow has the most interesting setup. Today will likely see a Dow TD Sell Countdown @13 if the close is above the high of TD Sell Countdown @11 (16,360.60). It is also sitting right at the 16,356.23 TD Trend Factor. Let’s see if the Dow begins to respect these price exhaustion signs as it may foreshadow the same for the other markets. 

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S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: NEUTRAL

Switch to bearish with weekly SPX close below 1805.81 (updated December 23rd)

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S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Will flip back to neutral with a monthly close under the January price flip level of SPX 1681.55. (updated December 1st)

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2 Responses to Thursday, December 26, 2013

  1. hatman says:

    SPX has reached the top end of the target range of 1819/1838, exceeding it by a point or two. At 1842 there’s a perfect Fibonacci relationship with the low at 1646. It’s time for a correction, and targets of 1760, 1640/60 are available if the market decides to turn tail. However, any further strength will open up much higher targets in the 1910/80 region. That area shouldn’t be met until the summer, and ideally needs the correction first, but with these bullish markets anything is possible.

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