11/2/2015

10/30: " SPX closed bang on the 2079 level. Watch this area on Monday! Basically, below ES 2077 & SPX 2079 is short term bearish, back above bullish until SPY Q4R1 that was resistance the last three days."

Although ES dropped below 2077 in the Sunday globex market, by open had recovered to 2077 and launched from there. Powerful rally continues with SPY, ES and SPX all above Q4R1s. If these levels can hold, then next target areas are substantially higher. 

SPY support Q4R1 209.07; next resistance 2HR1 213.80 & NovR1 215.20
ES support Q4R1 2077; next resistance 2HR1 2126, YR1 2138 & NovR1 2151
SPX support Q4R1 2079; next resistance 2HR1 2138 & NovR1 2151.

On the charts below, Q4R1 is the red crosses that acted as resistance the last few days and support today; the 2HR1 resistance above are the larger red dots, then NovR1 are the smaller red dots. 

10/30/2015

From 10/29: "SPY does look a bit toppy here with 2 bars under the Q4R1 at 209.07, with today being a smaller thrust with less volume; but SPX & ES remain quite positive above 2079 and 2077 Q4R1s respectively."

SPY clearly rejected from levels on Friday, and ES just below 2077 which adds to bearish concern. SPX closed bang on the 2079 level. Watch this area on Monday! Basically, below ES 2077 & SPX 2079 is short term bearish, back above bullish until SPY Q4R1 that was resistance the last three days.

We'll have new November pivots to check as well. Given the price structure of October, with huge rally from early low of month to high near the end of the month, most indexes will open above November pivots which can act as support. More on these soon. 

10/29/2015

SPY does look a bit toppy here with 2 bars under the Q4R1 at 209.07, with today being a smaller thrust with less volume; but SPX & ES remain quite positive above 2079 and 2077 Q4R1s respectively.

10/28/2015

Bullish day. SPY chart nearly reached Q4R1 209.07, but when we factor in SPX and ES it looks even better as both slightly cleared their Q4R1s at 2079 and 2077 respectively. In addition, several other notable bullish developments: DIA rallied above its 2HP 176.42 for the first time since 7/31, IWM jumped back above its YP 114.85, IBB finally lifted above its Q4P 318.47 for the first time since 9/17/2015, and XLF cleared its HP 24.19 for the first time since 8/20. 

SPY, SPX and ES below. Above the 2HPs is very bullish. For now we may see a shuffle around the Q4R1s, or the market may continue to power higher given the other bullish developments mentioned above.

10/27/2015

From 10/26: "SPY remains comfortably above 2HP 205.83, keeping the status of above all pivots, which is bullish." This level tested and held today witin just a few cents with the low of the day at 205.79. Holding is bullish, despite the somewhat more bearish concern from SPX and ES Q4R1s (see 10/26 post). 

That said, INDU / DIA and RTY / IWM look weaker today, as the case throughout the correction.

10/26/2015

SPY remains comfortably above 2HP 205.83, keeping the status of above all pivots, which is bullish. Views on SPX and ES look a bit more bearish with tags of Q4R1s on Friday and down a bit today (levels SPX 2079, ES 2077); but as long as they remain above their 2HPs (2059 and 2039 respectively) then trends remain up. 

Yes, there is a bit of difference between these three related vehicles. ES will factor in moves in globex that are not in the cash index or SPY. Wish I could pick one and be done with it but fact is all somewhat in play. See the last blog post for more. 

10/23/2015

Pow! SPY back above all pivots! From below all pivots as of 10/1 (Y, 2H, Q4, Oct); to clearing the highest 2HP today. There are always more levels to watch for resistance, and some of these tagged today on SPX, ES, and DIA; but the most important thing is SPX / SPX / ES above all pivots. Holding this designation means higher, so opportunity cost to hold longs is fairly low with SPY above 2HP 205.83. Again, I have been pointing to this as a target since 10/8 with the first clear of MR1, and then very likely since 10/15 with the 2nd clear. It was simply the next level up and had to go there. 

10/22/2015

Central bankers to the rescue! Any concern of yesterday alleviated with Draghi rally today. SPY has nearly reached target zone I have been pointing to since 10/8 with SPY / SPX above the MR1, meaning the 2HP at SPY 205.83 / SPX 2059.

This is a perfect time to consider what an ETF or stock will do when it reaches a major resistance level like SPY rallying all the way back to 2HP. 

Most bullish: Soar through it, open above the next day and level turns into support
Also bullish: Pause for 1-3 days, then blast through
Bullish with pullback: Drop from level, hold another support, then try again and clear
Tricky bearish: Exceed for 1-3 days then fail and drop under
Bearish: Test level and reject for trade-able drop
Most bearish: Fail before reaching level and commence sharp drop (this happened in July)

With all that in mind consider the chart below.





10/21/2015

SPY remains above MR1 and below 2HP as i have been pointing out for several days. However, all 3 China related ETFs and the one currency (ASHR FXI EEM AUDUSD) i spoke about in my last video blog post broke levels today. Also, IWM failed at its YP (also mentioned in yesterday's SPY daily as worthwhile to watch) and then also went straight through Q4P without any attempt to hold. This happened as TLT reclaimed its 2HP, putting it back above all pivots. There aren't too many ETFs that fall into that category these days. Last but not least, ES Z5 may have come close enough to its 2HP (within 5 points today) for sellers to come into the market. All this suggests trade-able drop is next move, but the other USA mains SPY QQQ DIA are above support so we'll see if Wednesday's drop has any follow through. SPY IWM TLT and ES charts below.

10/20/2015

SPY continues in safe zone above MR1 (thin red dots) 200.70 but below 2HP (orange dots) at 205.83 / SPX 2059.

 

That said it may be worthwhile to keep an eye on the IWM YP at 114.85, because it has clearly stalled at the 2HS1 / MR1 combo 116.34 / 116.39 respectively. IWM is the weak link of the main USA indexes (SPY, QQQ, DIA, IWM) and only one to make a lower low in September (compared to higher lows for the others) and now unable to clear MR1 (the others are above) despite 3 week of rally. Usually, the weakest index per The Pivotal Perspective is the best short candidate.

10/19/2015

There are various moving average resistance levels above (D100, D200) but from The Pivotal Perspective SPY has clear sailing until the 2HP at 205.83 / SPX 2059. For explanation of all these crosses and dots, please see the last video blog post. 

10/16/2015

Starting today I'm shifting to SPY instead of SPX for consistency. 3 charts below: #1 shows long term pivots (yearly and half-year), #2 shows medium term (quarterly and monthly), and #3 combines both. 

For abbreviations please check the FAQ page.

SPY and long term pivots (Y and H). After recovering and holding 2HS2 (green dots) on 9/30 & 10/1, 10/2-5 were the definitive trend change days with a huge high volume launch from 2HS2, then recovery of YP (orange crosses) and 2HS1 (green dots). After that, SPY held the YP / 2HS1 combo as support. On the long term view, SPY is clear to 2HP (orange dots). 

This chart shows medium term pivots (Q & M). 10/2 recovered above OctP (orange dots) and 10/5 launched above Q4P (orange crosses). MR1 (small red dots) was just resistance for 2 days; back above was bullish. Clear sailing to Q4R1 / MR2 combo. Not even back-testing the Q4P was a sign of strength. 


This chart shows both LT & MT together. Point is same. SPY is back above YP / Q4P combo as big support, and 2HS1 also helps. MR1 was the first possible resistance area. After being above for 3 days, it fell back underneath but only for 2 days. Clearing for the 2nd time means it should now act as support and other than weekly levels (not shown here) SPY should be heading to 2HP (orange dots) at minimum. Breaking MR1 would be the first sign (along with analysis of other indexes) to negate this view.

10/15/2015

SPX 2nd time above MR1 2003 today, very bullish. Next resistance other than weekly levels (short term only, almost never produces major turn by itself) is the 2HP at 2059. 

10/14/2015

SPX fell back under the MR1 2003 today, but still above the more important Q4P 1973 / YP 1963 support zone. That said, if you read my latest blog post, you'll see there are valid reasons for caution in the market. 

10/13/2015

SPX managed to hold just above the MR1 2003. Resuming above that on Wednesday would be the easy bullish path. If below then still have key support in the YP / Q4P zone 1963-73 respectively. For SPX at least I give the bull scenario the benefit of the doubt above that support zone. 

That said, some cracks have appeared in the rally. A pullback after a huge run is normal; it is the depth of the drop and then then the strength of the next move up that will give clues to whether bull market is returning in the style of 2011 recovery, or if the new quarter buying / re-balancing move is over and the downtrend is about to resume. Take a look at today's blog post. 

10/12/2015

Maintaining gains is bullish. Above MR1 2003 continues to point to 2HP 2059. Also support at WP 1996 (though I don't make too much of these for longer term moves), Q4P 1973 and YP 1963. 

10/9/2015

Rally slowed today but still all above MR1 2003 which points the way to 2HP 2059. The only thing in the way will be weekly levels which i don't really address here. Even if SPX falls back under MR1, then solid support in YP 1963 and Q4P 1973 zone. Since asset managers are playing catch-up, expect any dip to be bought. 

10/8/2015

Strong rally continues, SPX blasts through MR1 (monthly resistance 1) at 2003. As it so happens the next level up (Y, H, Q, M pivots, not weekly/daily) is 2HP 2059 - that is a lot higher! So if 2003 holds that is the next target. If 2003 breaks, still lots of support YP 1963 and Q4P 1973.

10/7/2015

Bulls continue in command as the Q4P 1973 tested and held yesterday, and then the index came within 3 points today yet finished with a rally and decent close. The first resistance is the current MR1 (monthly R1) at 2003. Again, the biggest point is above YP 1963 is bullish and means the market has made a very important re-test low. If SPX clears MR1 2003, the next resistance this month is 2HP 2059.

10/6/2015

Bullish day. SPX tested and held Q4P support at 1973; adding to chances that it remains above the more important YP at 1963. Above these levels and bulls really get the benefit of the doubt. Also watching 2HS1 1984 but so far more like pause than rejection. Some people might argue for bull trap and back down, but with The Pivotal Perspective you don't have to guess. SPX is bullish above 1963, period. If that fails again then i'll change accordingly.