• SP 500 Market Analysis 10-6-14

Pre-market update:

  • Asian markets traded 1.1% higher.
  • European markets are trading 0.7% higher.
  • US futures are trading 0.4% higher ahead of the market open. 


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

Technical Outlook (SPX):

  • Huge follow through on Friday to pile on gains from the large doji-candle formed on Thursday. 
  • Strong signs of continued price improvement in the pre-market today. 
  • A reversal off of the highs of today, would be a sign that we are only in a dead cat bounce. 
  • SPY volume has been strong over the last two days of buying. 
  • Some heavy resistance at 1970 on SPX 30 minute chart. 
  • Finally some meaningful movement out of VIX as it drops 10% on Friday to 14.55.
  • Recently, these bounces following meaningful sell-offs has resulted in SPX reaching new all-time highs. 
  • SPX coming out of overbought territory. 
  • This very well could be a bottom similar to what we saw at the lows in August.
  • Dead cat bounce resistance on the daily is at around 1978 on SPX. 
  • The market doesn’t care about the economy nor earnings. That is not what is driving it. The market only cares about what the Fed is doing to keep equities propped up. 


My Trades:

Chart for SPX:

SP 500 Market Analysis 10-6-14

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