Expect uncertainty to grow as the unusual string of bad weather in the US continues to affect economic data, with the latest miss coming from a -.3% print from the Industrial Production numbers this morning. On a positive note, the euro-area GDP printed slight expansion and even Italy eked out a print of 0.1%.
From the S&P 500 technical perspective, yesterday’s ramp up brought the SPX very close to the TD Trend Factor and there is a decent chance a TD Sell Countdown @13 will record today, raising the probability of at least a short term negative outcome. More on that below along with an Apple update. Also take note next Monday is an exchange holiday for the US.
S&P 500 (SPX) SHORT TERM OUTLOOK: BULLISH
Switch to neutral if SPX closes below 1819.13 today.
The 2 hour SPX recorded the first price exhaustion count with TD Combo Sell @13 at the close yesterday. The 4 hour SPX is on full-on active TD Sell Countdown and this supports the bullish tone. Next headwind comes at the 1834.55 TD Trend Factor along with the 2 hour SPX 13.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL
Switch to bearish with a close below 1799.84
A close equal to or above last Wednesday’s high of 1826.55 will finalize the 13 count for TD Sell Countdown for the SPX, and if the close is contained under the 1834.55 TD Trend Factor, this will be the sweet spot for a potential reversal. The Nasdaq (COMPQ) recorded a TD Sell Countdown @13 and one count short of a 13 for TD Combo Sell, all supporting the S&P’s potential price exhaustion. The Russell 2000 (RUT) is two counts away from a 13 for TD Sell Countdown. With both the RUT and COMPQ surpassing their respective TD Trend Factor levels, consideration will be given to the bullish case after a minimum pullback.
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH
Neutral if SPX weekly closes above 1842.27, most recent high close (updated January 27th.)
S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH
Flip to neutral if SPX (monthly) closes below 1756.54 (updated February 3rd.)
EQUITY SETUP UPDATE: APPLE (AAPL)
TD Sell Setup has perfected and the final 9 count is pending.
After the January 27th earnings release, Apple gapped well below the TD Support at 518.58, and it looked dangerous to become an Apple shareholder. However, AAPL has almost recovered all the losses pre-earnings, which was not in the script. This situates AAPL more into a giant trading range slop than an extreme bullish or bearish run. Currently Apple has “perfected’ the daily TD Sell Setup and a final 9 count is likely today. From here, if AAPL can keep the monthly TD Sell Setup alive by holding above 522.70 throughout the month of February, this provides the opportunity for AAPL to see 600 in the next couple months. Lose 522.70 and the bear discussion can resume.