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SPX filled gap below yesterday and that has opened the path to the next trendline target, which is rising wedge support from the early November low. That’s currently in the 2348 area. On the way is some support at an open gap into 2351.16. SPX 60min chart:
On Monday morning I gave a twenty handle inflection range on SPX, bracketed by important gaps above and below at the possible breakaway gap above from Friday’s close at 2383.12, and the open gap below from 2263.64. Since then SPX has resolutely stayed within that range, and is almost in the middle of the range at the time of writing. So far, so boring, but time is no friend to the bulls here. If we don’t see a break up towards ATH retests today or possibly tomorrow, then the window of opportunity to see those retests may well be over.
I won’t show the futures charts today but on all of ES, NQ & TF yesterday morning’s falling wedges that had broken up evolved into larger falling wedges, that have now all also broken up. Key resistance is still at the weekly pivots on ES (2379.75) and NQ (5363.25), and conversion of these levels to support opens the ATH retests there. We’ll see, NQ is currently above the weekly pivot there though that’s not the first attempt to convert it.
Nice decline on SPX yesterday morning, which didn’t fill the open gap support into 2363.64, and a nice rally in the afternoon, that didn’t fill the open (possibly breakaway) gap resistance into Friday’s close at 2383.12. The opening setup here is 70% bullish falling wedges breaking up on all of SPX, ES, NDX, NQ and RUT, TF. I posted my premarket video that I record every morning for Daily Video Service subscribers at theartofchart.net on my twitter this morning before the open to show the setup, and you can see that video here. SPX 60min chart:
I was saying in our monthly public Chart Chat at theartofchart.net yesterday that the kind of setup we saw at the close on Friday sometimes resulted in an opening gap through support, and we have seen that on SPX this morning. If you’d like to see that the recording is posted on this page here.
This is a potential breakaway gap down and that is potentially very bearish until the gap from Friday’s close at 2383.12 is filled. Below there is strong gap support from 2363.64 and a break below that opens lower targets, with the first of those being the next open gap below just under the possible H&S neckline in the 2352/3 area. The main trendline target now is larger rising wedge support, currently in the 2336 area, but we would usually some a topping pattern for to take SPX lower, and I don’t see one yet. The hourly RSI 14 sell signal is not close to making target. SPX 60min chart:
I’m working against the clock again so I’m mainly going to let the charts tell the story today.
The very short version is that SPX, ES & NQ are testing big support areas today and our lean is that they find support there today into a higher high next week, after which we see a return to these support levels and likely a conviction break below. Number, level, rationales etc all on the charts. TF important today as there is already a possible double top there that needs to not break down with conviction.
Stan and I are doing our monthly public Chart Chat at theartofchart.net on Sunday and we will be looking at everything in detail there. If you’d like to attend then you can register for that here. I talked about the setups in my premarket video for Daily Video subscribers at theartofchart.net this morning and if you missed me posting that on my twitter earlier you can see that here.
