| Current Position: | Long from SPX 1847 on 2016-02-12 |
| Indicator Divergences: | Neutral |
| Indicator Extremes: | Very Negative |
| SMA Setup: | Very Negative |
| S/R Levels: | 20SMA 1895sma, gap/trend line 1900ish, 50SMA 1952, Fib 50% 1950s, Parabola/H&S 1950s, Fib 62% 1990s |
| Sentiment: | Short-term Negative, Medium-term Positive |
| Important Events: | |
| Trade Plan: | With daily indicators not diverging negatively but reaching 3-month extremes, SPX is likely to start pulling back in the next day or two but then that high is likely to be retested in the subsequent week or so. It appears the 1950s and 1990s are the next 2 strongest resistance zones and 1900ish is the next strongest support zone. The System will go short on a gap down (usually >0.33% and 50% of the position will be taken on the gap and 50% on a half-fill) or a 1-candle swing (currently 1936 if no higher high tomorrow). The chart I attached is probably too busy, but the colored rectangles are significant ranges where there are gaps and pivots that act as support and resistance and you can see the levels I mentioned above show convergence with moving averages, trend lines, Fibs etc. Recent cyclical activity loosely supports a short-term high this week and a short-term low in 2-3 weeks but more importantly sentiment should prevent lower lows for a few weeks while longer cycles are still pointing to significant lows in April/May and October +/- likely near convergence levels at SPX 1750, 1600 and the 1100s. Good fortune. |
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