by Springheel Jack

I have been talking every day about AAPL over the last few days and the reason for that is simple.

Unless we are going to see a serious technical breakdown on AAPL the most likely place that the current decline would bottom out is at rising channel support on the weekly (LOG) chart, and that was finally tested on Friday. It is holding so far. Will it continue to hold? Hard to say, but the technical setup here certainly looks promising as I'll detail below.

I was saying a couple of weeks ago that there was not yet a clear pattern for the AAPL decline, and that, as I've mentioned before, is often an indication that it is too early in the trend for the pattern to have become clear. Now though it is clear, and it is a bullish falling wedge. If the current low can hold then there is also very encouraging positive RSI divergence on the daily chart. What AAPL needs to do next is break up from this rising wedge, and if we see that happen, then the low should be in:

Looking closer on the 60min chart you can see that there is an open gap into the 515 area that could be filled on a bounce here. If that is filled then we will have a break up from this falling wedge. The upper wedge trendline on this pattern isn't perfect, but it is decent and if you look closely at the chart you will see my notes on the short-lived break above the upper trendline:

Sentiment is now so bearish on AAPL that it seems hard to imagine that this downtrend could be over, but this is obviously often a contrarian indicator.

When I started to predict a likely sharp decline on AAPL in early September sentiment on AAPL was possibly even more bullish than it is now bearish, but sentiment was wrong then. It may well be wrong now.

On the SPX daily chart the RSI 14 is now in significantly overbought territory, and we are now entering my ideal high area (for my bearish double-top scenario) in the 1500-20 range. If we were to see a top form in this range we would ideally see a short term high about here, make a sharp retracement, and then make a slightly higher high on negative RSI divergence. Daily middle bollinger band support is now in the 1470 area and that would be an obvious target. Support at the broken resistance level around the September high is also in the 1470-5 range so that would be both the obvious target and a very possible low area if we see a retracement starting here:

Will we see that retracement? Well the strong negative divergence on the SPX 60min RSI looks promising and there is a possible double-top setup here. On a break below 1490 the initial target would be in the 1480 area. On a break much lower rising support from the November low could be hit in the 1440-5 area, and that would most likely fit with a test of the lower bollinger band on the daily chart:

On ES I have sketched in a possible broadening wedge forming if we do see a retracement here.

Again there is negative RSI divergence and a possible double-top setup. in addition the 50 hour moving average, support on uptrends, has now been convincingly broken for the first time since the last retracement. I have possible trendline support in the 1480-1 area and that is also the target area for the possible double-top. If a retracement has now begun, then I'll be looking for resistance today near the 50 HMA in the 1496 area:

Any retracement on equities here may well have support from both EURUSD and CL. On EURUSD I have sketched in a possible rising wedge from the 2012 low, and there is clear negative RSI divergence from overbought on the daily chart. Given that EURUSD is also testing a major resistance level and possible IHS neckline here we may well see a sharp retracement from this area. As I have mentioned before, the obvious target for that retracement would be in the 1.26 to 1.27 area. On the overall USD picture here I also noted yesterday that EURUSD has been swimming against the tide since the start of the year, with most other currencies falling sharply against USD over the same period:

CL is consolidating in the 95 to 97 range, and that's not inherently bearish yet.

However there is again clear negative RSI divergence on the daily chart and a possible double-top in play. On a break below 95 the double-top target is in the 93 area:

I've said before that an uptrend is defined in large part by retracements, as these establish support trendlines and the lower part of any patterns. Retracements have been rare and short on the current uptrend, and that is making it difficult to judge how far this might go. There is a very good chance that a retracement on ES and SPX is finally starting and obviously I would very much like to see that happen here to give some better definition to this uptrend. I'm leaning short today. Go bears! :-)

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by Springheel Jack

SPX closed at the upper weekly bollinger band on Friday for the fourth week running.

I've been looking again at the SPX 60min chart and there could be a broadening ascending wedge forming from the November low. It would need a decline into wedge support and reversal back up to confirm though really. In the short term it's worth noting that there is some negative divergence on the 60min RSI and a possible short term M top forming with a target in the 1481 area on a break below 1492:

AAPL tested channel support at 435 on Friday.

This is my primary support trendline for AAPL and a break below would be a big technical break. It is a very steep trendline however, with the first touch in 2003 at 6.25, and a break below would signal most likely only that AAPL has moved into a new phase that won't include huge moves upward. On that break below however, the next obvious target is strong support around the 360 area:

I have posted two scenarios on EURUSD over the last couple of weeks and we have now reached the point of decision where EURUSD should go one way or the other.

On the bull side I was looking at the sloping IHS with a target in the 1.42 area last week and that is a nice technical fit with a move to test declining resistance from the 2008 high. On the (short term only) bear side we could see an alternate IHS form with a horizontal neckline in the 134.8 area, and that was tested at the high last week. If that forms we would now see a right shoulder retracement lasting months with an ideal right shoulder low in the 126-7 area

Is it possible that we could see a big reversal like that on EURUSD?

I think so yes, though technically I prefer the other scenario. EURUSD has been strong in recent months, but since the end of 2012 it has been plowing a lonely furrow of strength against USD. That has a big impact on USD, as EURUSD is 57.6% of the basket of currencies that make up the USD valuation, but elsewhere USD has been looking impressively strong.

I watch five main currency pairs for USD on a regular basis and they are EURUSD (57.6%), JPYUSD (13.6%), GBPUSD (11.9%), CADUSD (9.1%), and AUDUSD (not in USD basket). Since the end of 2012 all of the other four have fallen significantly against USD to the extent that even though EURUSD has gained significantly over this period, USD is flat. I don't know what this is telling us overall, but I do know that the Yen (JPYUSD) is in very serious trouble, and may fall a long way below current levels, and the next largest component GBPUSD has also been showing a lot of weakness in recent weeks, to the extent that last week GBPUSD broke below the trigger level on a double-top indicating back to the 1.536 level, effectively a test of the summer 2012 lows. If this pattern is going to fail then the likely place is right here, just below broken pattern support, but if it continues down below 1.57, the chances are that those lows will be tested in the next few weeks. If we see a big reversal on EURUSD here as well we could therefore see a very impressive rally on USD over the next few weeks. Here's that setup on the GBPUSD daily chart:

For today on ES I have some weak trendline support and the 50 hour MA in the 1493.5 ES area. Secondary support is at 1490.75 at Friday's low. If we see a break below Friday's low the next obvious support is in the 1486.5 area. I have some trendline resistance in the 1501.5 area.

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by Springheel Jack

AAPL blew straight through the support trendline from early 2009 at the open yesterday and is now very close to testing weekly (LOG) rising channel support from 2003.

This is AAPL's primary support trendline and a break below it would be a major technical break. Now that AAPL is close to that line I am refining the target to 440 plus or minus 5. If we see this trendline break I then have the next major support level around 360 and it's worth mentioning here that a percentage decline of that magnitude (to 360) from the 2012 high would be in line with the declines in both 2006 and 2008:

ES is still making higher highs and lows, and the 50 hour moving average is primary support. That's now in the 1488.5 area and if we should see a break below yesterday's low at 1486.25 this chart would start to look interesting on the short side:

On the SPX weekly chart I have upper bollinger band resistance in the 1501.5 area. I'm not expecting a close much above that today.

This is the fourth week of SPX pushing up under the weekly upper bollinger band, and in terms of past moves on the 7 year chart below, a median move like this would run six to eight weeks before reversing to test the middle BB. This move is therefore not extended in historical terms, though everything is now overbought on the daily RSIs of course:

I've looked often at the possible rising wedge / double top setup on the SPX and Dow charts, and I've been sounding increasingly doubtful about these as this bull run on equities has continued, even though we are now in my ideal target zone for both for the second high. Why is that? Simply because of the nature of the move up this month. I expressed doubts about these setups in December because the weekly RSIs are not at a level where any normal major top signal could be seen, and that was a strike against this setup from the beginning.

What could have strengthened this setup considerably would have been rising wedges forming on SPX and Dow from the November lows, but we haven't seen that.  

What we are seeing is moves up that at this stage have no well defined support trendlines or overall pattern. What this generally means is that it is too early in the trend for these to be clear, and that is not bearish at all. If these rising wedges / double-tops are to play out, I would expect to see a major high on SPX in the 1500-20 area. If we don't see that then the obvious target area is a test of the 2007 highs and if we are to see the next bull market top develop with the sort of weekly RSI signal that you can see on the chart above at the 2007 and 2011 highs, possibly considerably higher than the 2007 high. Here's the updated rising wedge setup on the Dow daily chart and you can see that the daily RSI 14 has now just edged into overbought territory:

NDX is the weakest index here, obviously because of AAPL. There is a possible rising wedge developing there from the November low but in the absence of supporting patterns on Dow, SPX, RUT and TRAN my confidence in this isn't high. A move to test wedge support would strengthen this setup considerably though.

EURUSD has broken up from the triangle I was looking at yesterday and is on the way to test the next major level at 1.35. On a break above I have the next trendline resistance in the 1.38 area. I'll be looking  more at this next week as EURUSD is giving a very misleading impression here that USD is weakening fast, whereas in fact USD has been strengthening against Yen, GBP, AUD and CAD. The uptrend on EURUSD still looks good here though:

The last two chart today are updates on plays that I have posted before. The first is Yen (JPYUSD). Since I posted this very bearish chart in late November at the 126 level Yen has been collapsing against USD. it is now very oversold on the weekly RSI and there is serious talk of a bounce here. If we see that the bounce would target resistance in the 114.5 to 116 area and should be sold down to the H&S target and decent support in the 105 area. Longer term I think we may well see Yen make the wedge target in the 80 area:

The last chart is the very nice looking long setup on KOL, still at a very attractive buy level. If you're looking for something to buy that's beaten down and offering a very nice looking bullish reversal setup, this is a decent looking play:

For today I'm looking for a higher high on ES over 1498 in the pre-market, followed by weakness into obvious support near the 50 hour moving average in the 1488.5 area, followed by strength. A break below 1486 would be a break of the current sequence of higher highs and lows and would suggest a test of support in the 1475 ES area.

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by Springheel Jack

AAPL beat on profits but disappointed on revenues last night.

There was a big reaction and I read of AAPL trading as low as 461 in the after market last night. It may have gone lower. Some of this seems likely to persist into trading hours so we may shortly see the test of the main rising support trendline from early 2009. Will it hold? Depending on what happens on the daily RSI today that currently looks promising for a reversal at this support trendline:

If that trendline should break I have next support on AAPL not far below at rising channel support from 2003 on the weekly (LOG) chart in the 445 area. That's very approximate, plus or minus ten given the scale of the chart. A break below there would look very bearish:

All steep rising support trendlines break eventually, and these are both steep trendlines that have carried AAPL a long way.

A break below them might just be a signal that AAPL is finishing a high growth phase and moving towards being a lower margin company with limited growth prospects. One way or another that is likely to happen, as AAPL is huge enough already that growth prospects must be somewhat limited, and faces increasing competition in most markets. On the other hand AAPL products are still superb, their prospects for making very good money in their markets in the future look good, and they are on a forward P/E of just 9, which is modest unless earnings are going to fall a lot from here. I think AAPL will most likely hold one or the other of these trendlines this time. We shall see.

There was a nice double-top that formed on the ES 60min yesterday, and that broke down overnight. As I have mentioned before however, when these patterns fail it tends to be just below the pattern trigger level, and ES reversed back up strongly there. I have strong support in the 1484-5 area, and if we see a break below there we may well then see follow-through to retest the 1475 level. I have a possible channel support trendline there, but it is a poor quality channel so far:

On the SPX 15min chart there is a clearer setup, with yesterday's higher high on negative 15min RSI divergence. If short term rising support in the 1493.5 area breaks then we should see some follow-through, with possible trendline support in the 1480 area fitting well with a target in the 1475 area on ES:

Middle bollinger band support on the SPX daily chart is now in the 1459 area. Statistics still favor SPX touching the middle BB before another touch of the upper BB, now in the 1510 area, though both are rising so fast that this is doubtful as a shorting opportunity. What is worth noting on this chart is that rising wedge resistance on SPX is also now in the 1510 area, and I wouldn't expect that trendline to be broken if this rising wedge is to play out:

That setup is clearest on the Dow chart, with wedge resistance there now in the 13950 area.

If we are seeing a broken rising wedge and double-top setup then the second high would also ideally be not much more than 2% higher than the first, and that target is in the same area. I can't say I have any great confidence that this classic reversal setup will play out, but it is a classic reversal setup, so I'm following it:

EURUSD is consolidating in a sort of triangle.

The obvious next move is up in my view, but there is a possible double-top setup that would trigger on a break below 1.325:

Mainly I'll be watching the SPX 15min chart this morning. If we see that short term support trendline break downwards I would expect some follow through. Nothing to get particularly excited about here on the short side unless we see that happen though.

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by Springheel Jack

Waiting for the retracement within the rising channel on SPX has been a bore.

The strong resistance trendline has been holding well and it seemed just a matter of time until we saw at least some retracement. However SPX broke above rising channel resistance yesterday and while it may fall back inside today, that opens up potentially considerably more upside before a retracement:

What other resistance do we have? Well a key resistance level on SPX is the weekly upper bollinger band. We are now in the third week of moving up under that resistance and it is now in the 1500 area. We may well now see a touch or close around that level this week. As an aside it's worth having a close look at this chart to see how long SPX can crawl up under the weekly upper BB without testing the weekly middle BB (now at 1433). I counted one instance on this chart where that lasted 21 weeks from the first touch of the upper band. Food for thought:

The SPX rising channel wasn't the only pattern in play here, though it was most definitely the most promising for a decent retracement anytime soon.

There is also a perfect rising channel on RUT that I'll be keeping a closer eye on now. That has plenty of upside room here and it's worth noting that every retracement or consolidation in the last two months has been signaled with negative 60min RSI divergence, of which there is currently no sign on either the RUT or SPX charts:

I was chatting to a trader friend in September talking about the impact on the wider equity markets of the sharp fall on AAPL that I was expecting.

When we saw that fall it did indeed help shake the markets. What seems strange now though is that, though NDX is underperforming, SPX has been flying up without any support from AAPL. AAPL hasn't been moving much recently and I'm still looking for a hit of resistance in the 518 area before a final low (probably) in the 465-70 area. I understand AAPL earnings are out today and we could see a break up earlier than I expected if they surprise to the upside. The positive RSI divergence on the daily chart is promising for a low already being in, though from a technical perspective I have been expecting a hit of the main support trendline, and we haven't seen that yet. That doesn't always happen though:

I was talking about a possible EURUSD target in the 1.42 area last week and the chart below shows that scenario, with a downsloping IHS that has broken up with a target in the 1.42 area, which is a good fit with a test of declining resistance from the 2008 high, now in the 1.425 area. I think we may well see this play out:

I can see no signal here for a retracement in the near future on SPX.

As long as that remains the case we are running the standard bull run program of an early dip that should be bought followed by strength for the rest of the day. Key support is now at yesterday's low at 1475 ES, and if we see an early dip into the 1480-3 ES area then that would look like a decent long entry level for today. If we see a move below 1475 ES then that would signal that we are in a retracement or consolidation phase that would most likely last at least a couple of days.

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by Springheel Jack

The bears have a shot at at least some downside this morning though there hasn't been any real selling so far this year.

However the rising channel on SPX is holding, and the second touch of channel resistance on Thursday was retested on Friday on negative 60min RSI divergence. There's been some weakness overnight and if there is a break below 1470 then I have a small M top target in the 1457 area with some possible trendline support in the 1467 area. Here's how that looks on the ES 60min chart:

On the SPX 60min chart there is a small short term rising channel and a break below 1470 ES should break that channel. While the overall rising channel holds upside looks limited, though we can of course just continue to trickle up under channel resistance:

SPX daily bollinger band resistance has now hit 1500, but that isn't a target this week unless the rising channel on the SPX 60min chart breaks up. The daily middle BB is now at 1453. As an aside I've been looking on this chart at the longest period since July 2011 that SPX has trickled up under the daily upper bollinger band without testing the middle bollinger band. The longest periods on this chart were about a month before that test, and we're three weeks into this move since the first touch of the upper BB so I would expect that test in the next few days:

EURUSD is looking promising for some retracement here.

There is a possible double-top at 1.34 with a target in the 1.311 area on a break below 1.325. I also have trendline support on EURUSD in the 1.311 area so this is a promising setup:

CL has broken above clear trendline resistance.

If there was a rising wedge here on CL that would look bearish but there isn't. Trendline support is now in the 93.4 area and strong resistance turned support is in the 94.8 area:

As long as rising channel resistance holds on SPX I am favoring some retracement on SPX soon to at least test the middle bollinger band on the daily chart. There is a promising setup for that this morning which may well deliver if we see ES break below 1470. These trickle up moves can last a while though and I would see the retracement setup today as promising rather than probable. We shall see.

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by Springheel Jack

SPX moved up strongly yesterday and I posted the updated SPX channel on twitter in the afternoon before the high. I posted another after the close and here is that chart for you again this morning:

As you can see SPX hit the upper channel trendline again at the high yesterday and reversed there (buffs fingernails modestly). Obviously anything can happen and SPX could break up through that trendline, but that is a strong trendline that has held five times so far, and I'm expecting reversal from there unless we do see an unexpected break above. We may see a test of yesterday's high before a retracement but we won't always get that.

On the daily SPX chart the upper bollinger band has not been hit again yet. That's also as expected given that I've mentioned before that the odds strongly favor a test of the middle bollinger band before we see another hit of the upper bollinger band, and the middle BB is now at 1450 (and rising). I've put some notes about RSI divergences on this chart that are worth a look.

I would also note that if we are seeing a double-top forming on SPX here with the September high as the first peak before the break of the rising wedge from October 2011, then that should ideally be within 3% of the first high, giving an upper limit of 1518.75 for this second high. I prefer the second high to be within 2% for a really high quality pattern and that gives an ideal upper limit of 1504. The second high can sometimes be within 5% of the first, though that weakens the pattern in my view and that gives an upper limit at 1548.25. Anything over 5% apart I would generally not regard as a double-top. Unless we see strong evidence to the contrary I am expecting to see another push up after a retracement from here, and obviously the next high could be a major top:

The other big rising wedge to watch here is on Dow of course, and there I am looking at a similar broken rising wedge and candidate double-top forming setup. Dow finally broke back over broken rising wedge support yesterday and is now therefore placed to test the September 2012 high and most likely exceed it. I prefer the second high on a double-top to exceed the first though that doesn't always happen of course:

AAPL has rallied considerably in the last couple of days. Is the AAPL downtrend over? I don't think so though possibly.

The obvious downside target though is in the 465-70 area at rising support from early 2009 and that hasn't been hit yet. A falling wedge of dubious quality has formed from the high and that could be strengthened considerably by a reversal at declining resistance in the 518-25 area and a last move down to hit wedge support and rising support from early 2009 in the 465-70 area in a week or two. We'll see whether that happens. Obviously we could see AAPL break that support but that would be a big technical breakdown, and I'm not really seeing any fundamental reason to expect that. I am biased as a huge fan of iPhones and iPads though:

I'm going to show a different view on oil and the Euro today just to give an idea of where I see the bigger picture on both.

As I mentioned yesterday there is a big support/resistance level on EURUSD in the 1.35 area and we may see a significant retracement from there. Adding some weight to that is the failure of the H&S that formed in 2010/11 to reach target. As I've mentioned a few times I don't like H&S patterns where the neckline starts early in the previous trend, and you can see that on this example. However where an H&S fails, an H&S pointing in the opposite direction will generally form to confirm the failure, and the obvious horizontal neckline for such a pattern is in the 1.35 area. That's not a sure thing by any means but we may well see a strong reversal there.

There is an argument however that a downsloping H&S has already formed and is playing out, so very possibly not. I'll post that alternate H&S with the target and a possible overall triangle scenario on Monday, though I'll say now that this alternate scenario has an upside target in the 1.42 area at declining resistance from the 2008 high:

Oil I have charted up on a one year 60min chart (on USO) and that is to illustrate that oil generally forms decent quality and clear patterns or channels on both uptrends and downtrends, with decent reversal patterns more often than not at the point of reversal. There is of course no clear pattern or channel yet on the current move and that generally means that there are not yet enough data points to identify the pattern that is forming. That is often the case early in a trend and the obvious next big high on this move is above 37.17 on USO. I see no reason to expect an end to this move before that and it may go considerably higher. On the fundamental side I'm hearing a lot of chatter that oil prices may drop a lot over the next few months, but I can't see any reason to expect that on the chart at the moment:

I've been outlining the overall bear case on SPX and Dow here today.

That doesn't mean this is necessarily going to happen, and there seems to be general agreement here that equities are poised for a big move up in 2013. What I would say is that I tend to ignore sentiment except as a technical signal, and the setup on SPX and Dow here is a classical bearish topping setup at the moment. That may fail of course, but until it does fail I will be watching it very carefully. Monday is a holiday so my next post will be on Tuesday morning. Everyone have a great holiday weekend! :-)

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by Springheel Jack

The gentle rising channel I was looking at yesterday on the ES 60min chart is still holding this morning, with channel support and resistance in the 1460.5 and 1481.5 areas respectively.

On the SPX daily chart the high yesterday was less than a point away from the September high at 1474.51. That may well therefore be broken today. I have rising channel resistance in the 1485 area and the  daily upper bollinger band at 1491. Statistically we would normally at this stage see a test of the daily middle bollinger band before another test of the upper BB and that's now at 1449:

I was saying yesterday morning that EURUSD looked like it had bottomed or was bottoming.

It then made a very marginal new low and spiked up over 1.333. The next obvious move is a new rally high over 1.34 and there is a lot of trendline resistance on the upside. On the larger scale charts 1.35 is a big resistance area to watch and a possible major IHS neckline, so I'll be watching that area with great interest. If the IHS forms I would expect a big reversal from near 1.35 back into the 1.25 to 1.30 area to form the right shoulder:

CL looks a bit more promising for bears today, if only because CL is testing the top of the current consolidation range.

The obvious next move is a last retracement to test main rising support in the 92.5 to 93 area and we may well see that today and tomorrow:

I posted the gold chart yesterday and I'm posting thea silver chart this morning.

There are significant differences between the charts but in essence they are singing the same song. In the background is a huge descending triangle that has broken up and promises great things as long as strong support in the 26 area holds. Shorter term silver is paused at the 50 DMA on the way to trendline resistance on a small bullish broadening descending wedge:

There has been much excitement this week about the new lifetime highs on RUT and TRAN. Time to pile in on the long side? Not so much. On the 20 year RUT chart you can see that I only found one instance in the last 20 years where the breakout level over a significant resistance area was not at least retested over the next few months and many of these retraced far below:

Looking at just new lifetime highs on the TRAN chart, I found three breakouts in the last 20 years that held above the breakout level for at least a year. A further three were at or close to major highs, and the remaining five retraced well below the breakout level within three months. That's what you would expect really, the last new lifetime high on SPX in 2007 was a major top and anyone buying there has been waiting a long while to even get back to within 10% of that. I'm not aware of any investor's maxims that start with 'Buy High':

ES is looking strong at 1470 as I write this. A marginal new high over yesterday's high has now been made and the odds for an early retracement to fill the gap look decent. Bears haven't much to get excited about longer term unless ES can either make it to 1481.5 area channel resistance or break below 1460.5 area channel support.

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by Springheel Jack

I posted a chart of the daily SPX early last week with the observation that of the last twenty times that SPX closed more than ten points below the daily upper bollinger band, support at the middle bollinger band was hit sixteen times before the upper band was hit again.

To that extent the odds are still with the bears for the moment. Middle bollinger band support is now at 1447 and still rising, and it therefore isn't far now to reach it either. While we watch this sideways action however, the potential upside within the SPX rising channel and below the upper bollinger band is opening up, and resistance on those is now in the middle to high 1480s. That needs to be borne in mind from a risk/reward perspective:

ES broke back up through the 50 hour MA in the afternoon yesterday but that didn't hold overnight and has now turned back into resistance. The 50 HMA has crossed below the 100 HMA which is a decent short term trend change indication. However on the bull side I have found a shallow rising channel on ES for January trading so far, and that will need to break down to see any further retracement. Channel support is in the 1458.5 area this morning. Channel resistance is just under 1480, and that's a worryingly good fit with the larger channel resistance on SPX:

If we do see more retracement the key pattern to watch is the nicely formed potential double-top on NDX. The technical setup for further retracement there looks compelling and the target on a clear break below 2703 is the 2656 area, not far above rising (possibly wedge) support now in the 2635 area. I'm still thinking there are decent odds that we will see that happen before the next move up:

Other markets aren't that encouraging for the bear side this morning. EURUSD has made the little double-top target area, retested it on some positive 60min RSI divergence and is clearly trying to make a low, so the immediate retracement low on EURUSD may well be in.

If EURUSD is still in a downtrend then the 50 HMA should be decent resistance and that's very close to broken support in 1.3333 area. If we see a break over that I'll be expecting the retracement low to be in:

CL is still chopping around in the 92.65 to 94.8 consolidation range.

Main rising support is now in the 92.3 area and will rise to within that consolidation range within a few days.We may well not see significant further downside on CL before the next decent move up:

I posted the gold chart a few days ago, highlighting the bullish W bottom setup on positive daily RSI divergence.

The uptrend there has continued and the resistance levels to watch are first the 150 DMA at 1678, at which gold both opened and closed yesterday, then the last high just under 1700, and a break above that triggers the W bottom target in the 1775 area of course, and declining channel resistance, which I have in the 1710-15 area. If we see breaks over these then I'll be looking for a retest of the serious resistance in the 1800 area:

Overall I'm leaning somewhat towards the bear side this morning, with the caveat that the rising channel on ES will look bullish until it breaks downwards. A clear break below 1458.5 will kill that off, but if we see a clear break back over the 50 HMA, now in the 1463.5 area, then we could well see a move to channel resistance in the 1480 area. I'll be posting a couple of AAPL charts on twitter later on to show the two key support levels that AAPL is now getting close to testing. My twitter handle is shjackchartsif you want to see those.

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by Springheel Jack

The retracement that I was talking about as likely yesterday morning seems to have started now, with ES at 1457.5 as I write.

Daily middle bollinger band support on SPX is at 1443 now, but it's worth bearing in mind that the channel support trendline on the current SPX rising channel is currently in the 1415 area. As this retracement develops I'll be looking for a declining resistance trendline to form to help identify when the retracement finishes. Short term there is a double-top target on ES at 1453 and here is the updated rising channel on the SPX 60min chart:

There is a nice looking double-top forming on the NDX chart with a target in the 2660 area on a clear break below 2703.75. That's a decent fit with a touch of rising (possibly wedge) support on the NDX chart:

AAPL made new intraday lows yesterday and it looks as though strong support in the 500 area may break.

I have two key support trendlines to watch on AAPL. The lower is in the 545 area and a break below that would look very (and surprisingly) weak. The higher support trendline is from early 2009 and is a decent quality trendline with three touches. I have that in the 460-5 area at the moment:

I talk regularly about breaks from rising and falling wedges being followed by the formation of a reversal pattern that then triggers the main break down, and on the daily chart we may well be seeing that on SPX.

There is a very good shorter term example of that on the EURUSD chart over the last few days. As I mentioned yesterday morning the last EURUSD move up formed a rising wedge that had broken down. A bearish descending triangle has then formed and that has now also broken down. EURUSD is testing resistance turned support in the 1.33 area, but the triangle target is lower at the 1.325 support area:

CL is consolidating in the 92.65 to 94.8 range.

We may see a break below 92.65 but more likely I suspect CL trades sideways in this range until rising support from the low can be tested within it. That's now just under 92:

I'm expecting at least some more downside but the target is unclear. On ES I will be watching the 50 and 100 hourly moving averages (HMAs). In a retracement of any real size the 50 HMA generally moves below the 100 HMA and acts as primary resistance and a subsequent break above the 100 HMA then generally confirms reversal. The 50 HMA is currently at 1465 and if the market is weak today I would expect the 50 and 100 HMAs to cross bearishly in today's session.

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