Market is winding back up for another assualt.. $spx

Good morning. 

 

A little sideways action is the way that strong bull markets correct.  We are coming into the close of the month midst earnings season which is seasonally strong for the rest of the week.  Europe gapped open strongly but was not able to hold the gap and has fallen off since the open taking what had been a 5 point ES up night down to minus 2 points.  We have some more historical data coming out at 8:30 am this morning, durable goods, that could help set us in the right direction.

 

I continue to hold long here anticipating perhaps a 1 or 2% drawdown from here before heading higher.

Quote of the day:
I have learned to use the word ‘impossible’ with the greatest caution. – Wernher von Braun

 

Chart

Score

 Day-1

Change

40 DPI

+2

+6

-4

52 WNH

+0

+6

-6

10 DHL

+0

+6

-6

Total

+2

+18

-16

 

We lost a lot of breadth on Tuesday but  we did cling to a +2 bullish score.  The charts were not devastated they just all missed by a smidge for bullish scores.   

 

$SPX chart:

 

Tuesday the markets coiled into a wedge getting ready for the next break out.  The 1116 area we drew turned out to be the upper limit for the day.  The gap opening had us scared for a little while but we quickly dropped down into the targeted trading zone [ a great fade if you played it ].  That zone continues today between 1108 and 1116.  We really won’t  have a break until we clear 1120.  A pullback to the 1102 area is still very possible and I will be buying if we were to get there.   I have no idea if we will breakout to the upside today or downside but I have my wedge drawn on my charts and the break will let me know.

 

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