The sweet spot for a reversal that started on December 13, 2017 and ended when the S&P 500 (SPX) made new highs on January 24, 2017 has passed us. The next best chances for a reversal are coming up this week. Here are some timeframe by timeframe thoughts about where we could be heading: The rally on the monthly S&P 500 (SPX) is being validated by the upside move in the TTM_Squeeze indicator. Further confirmation can come if the monthly SPX can close above the TD Risk Level at 2367.62. From the weekly perspective, the SPX is barely under its TD Risk Level at 2319.07, but the TD Sell Countdown is in its middle stages, suggesting higher prices ahead. Now this brings us to the daily SPX where it gets a bit more interesting. The daily SPX has already recorded a TD Sell Countdown @13, and nearing the TD Trend Factor at 2323.89. A TD Sell Setup @9 and TD Combo Sell @13 can record this Tuesday and Wednesday. If this occurs, it will be all about the nature of the selloff. Will it be similar to the previous selloff which was a month long sideways consolidation? Will it be a typical 3-5% selloff which brings the SPX back to the bottom of the trading range around 2250, or will it be something more severe and create a bearish price flip in the monthly SPX? Since the longer duration timeframes are bullish, the 3-5% selloff is more probable at this point.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL
Bearish if daily SPX closes below 2293.08 on Monday, February 13, 2017
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: NEUTRAL
Bearish if weekly SPX closes below 2271.31 on Friday, February 17, 2017
S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH
Neutral if monthly SPX closes below 2126.15 on Tuesday, February 28, 2017