Wednesday, January 20, 2021

SPX Update: Downside Target Captured, and Support Then Holds

Today is 1/20/2021, which makes it an rare palindrome date (I have no comment about that, but thought it interesting).

Last update suggested that a trip to the 3760s in SPX wouldn't be unreasonable, but that we wouldn't look too much lower unless "red support" (chart below) failed.  Red support was then tested basically to the penny, and held.  Bears thus would still need to break support to get much more going.

Note that I have "4?" shown in gray -- this is because I'm not convinced this is wave 4 at the degree that's labeled (it was a bit short for that), so we might not be onto the larger 5 yet, but may still be in 3 (hence the higher blue "3?").

Bigger picture, we have indeed "hemmed and hawed" around the IT line, but that may finally change now that we've tested and bounced from support.

While looking through my chartbook, I also came across an old legacy COMPQ chart, which I found interesting:

In conclusion, SPX held support and COMPQ is also above a long-term trend line... as I've said for a while, IF these breakouts can hold, then bulls can run it notably higher.  To break things, the first level bears would need is now clearly defined at 3749.  Trade safe.

No comments:

Post a Comment