• S and P 500 Market Analysis 1-07-13

Pre-market update (updated 9am eastern):

  • Europe is trading -0.4% lower. 
  • Asian markets traded -0.3% lower. 
  • US futures are trading slightly down ahead of the bell. 

Economic reports due out (all times are eastern): Treasury STRIPS (3pm)

Technical Outlook (SPX):

  • SPX found some momentum to close higher on Friday despite being clearly overbought at this point. 
  • Post Recovery highs are at 1465 on a closing basis. SPX on Friday closed one point above it at 1466. 
  • There’s really no significant level of resistance for the market above 1466 until you get to 1501. 
  • Bears need to work on getting the SPX back below 1455 for starters and ultimately back below 1430. 
  • It will take a significant move, but below 1398, the trend will be bearish. 
  • Be aware of upcoming news events and discussions that will permeate the markets: Debt Ceiling Debate, Fiscal Cliff Part II, Employment Recovery. 
  • We are hitting the upper band of a well-defined channel that the SPX has been trading in since the November lows. 
  • There is still a huge gap on the SPY chart that ultimately needs to be filled. 
  • 30-minute chart looks extremely over-extended. 
  • The consolidation, in a perfect world, shouldn’t pullback further than 1448, where there is minor support. 
  • VIX currently is under 14 which is extraordinarily rare. 
  • Trend-line has dramatically flattened off of the November lows. 
  • SharePlanner Reversal Indicator confirmed a bearish reversal to come. 

My Opinions & Trades:

Chart for SPX:

S and P 500 Market Analysis 1-07-13

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