SPX didn’t make it to my minimum retracement target at 2080 as it made a perfect touch of the 50 hour MA and reversed hard there. That does tend to be solid support in uptrends until they are into the topping process and, as I was saying on Friday morning, this uptrend doesn’t look finished yet.
I am considering the possibility that a rising wedge from the October low is still forming and have drawn in that possible rising wedge support trendline in blue dotted line on the chart below. If that is the case then there is a very obvious target in the 2120-5 area at the intersection of the original wedge support trendline and the wedge resistance trendline. That is the first area of resistance that I am watching. SPX 60min chart:
If the wedge overthrows that resistance area then my last area of resistance is at the weekly upper band and primary trendline resistance, now in the 2145-50 area. If tested I am expecting that area to hold as resistance. SPX weekly chart:
Overnight CL has broken hard below double support at triangle support and the daily middle band, both in the 51.2 area. Unless that is quickly reversed the obvious next target is a reversal back down to the main low at 44.39 and I have marked the three targets in the 43.7 to 45 range on the chart below. CL daily chart:
On 3rd February I posted a TLT chart showing the test of lifetime rising resistance and the possibility that we would see hard reversal there. We have seen a hard reversal there and I am working up a roadmap for what I am expecting to see on bonds this year. The next moves would ideally be a move to test megaphone support in the 120 area, and then a retest of the lifetime high at 138.22. TLT weekly chart:
I have the weekly pivot at 2099.2 this morning and am looking for a test of that at the AM low, and possibly lower. That AM low, wherever it ends up, will most likely be a buy, as the bulls remain firmly in control of this market for the moment.
