Good morning. Futures are a touch higher, sp +2pts, we're set to open at 1938. Equity bulls need to break the Monday high of 1944, which will open up the 1950/55 zone. Metals are trying to bounce, Gold +$3. Oil is weak, -0.4%.
sp'60min
Summary
As noted yesterday, price structure is a rather clear bull flag. I'd be very surprised if we break lower this morning. In theory, we should break above the flag this morning, into the 1950s.
*I am long..and will look to exit somewhere in the 1950s.
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US equities closed higher for the second consecutive day, and the issue now is whether the market will put in a lower high (<sp'1991).. or whether this is merely the start of another multi-week up wave. Best guess....sp'2030/50 zone in September.
sp'weekly8b
sp'daily3
Summary
So...a second day higher, and we're on our way to the first target zone of the 1950/60s. The big issue is whether...
1. we get stuck 1950/60... fail....and break a new low <1904
2. we get stuck... fail..... but put in a higher low >1904...and break 1970s on 2nd attempt
3. we just push right through into the 1970s
Personally...I'd guess, scenario '2'.
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Chart daily'3 is a simple Fibonacci 1.6x extrapolation... it might be overly bullish, but if the giant sp'2000 threshold is breached, a further 2% wouldn't be that much to expect.
Looking ahead
There is nothing of any real significance tomorrow.
*next sig' QE is Thursday
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Video from Gordon T Long - Tops are a process
*The following was posted on youtube over the weekend, but was originally released for Mr Long's subscribers in June.
Interestingly, downside to the low 1600s I'd agree with, along with a subsequent major bounce.. perhaps to a new high. As ever, always worth seeing.
I'm trying.... really
So... I exited this morning at sp'1941.. and long again this afternoon from 1937. Hourly cycles are offering a bull flag..and frankly.. the sp'1950/55 zone looks a rather easy target. The only threat is a sporadic news story, but hey, isn't that always the case?
Right now, I'm trying to be careful, make some gains on the long side, and be mindful that the bigger monthly cycles are rolling over. A peak in the low sp'2000s next month looks very viable, and would make for one hell of a level to short the market from.
US indexes closed higher for the second consecutive day, sp +5pts @ 1936
(intra high 1944). The two leaders - Trans/R2K, settled higher by a borderline significant 0.8% and 0.9% respectively. Near term outlook is for the
sp'1950/60s.
sp'daily5
R2K
Trans
Summary
The more significant strength in the two leaders - Trans/R2K, is especially bullish for the rest of the market this week.
With the break into the 1130s, R2K looks set for the 1160s...the 1170s is first key resistance, and we'll probably get stuck there...if only for a minor retrace.
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