Candidate Breakaway Gap

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My last tweet of the week on the member twitter feed on Friday was a comment that the close was modestly bearish, but with a risk of a breakaway gap up at the RTH open today, and here it is.

Today is all about a test of strong resistance at the retest of broken rising channel support and the daily middle band at 2089. This is a daily closing basis test, so we could see a break above intraday, but any intraday move over 2095-2100 SPX would suggest a likely break up.

If SPX fails here then fills the opening gap then we should see a retracement low under 2050. If SPX breaks resistance then the current swing high at 2120 should be retested, and may well break into a test of the all time high at 2134. SPX daily chart:

160619 SPX Daily

One thing I’m watching with interest here is the strong RSI 14 buy signal on the SPX hourly chart. After the open today that is still some way short of the possible near miss target, and that is also suggesting a break back up today, though I’ll be keeping an open mind. SPX 60min chart:

160619 SPX 60min

Obviously this may be a heavy news week and that isn’t going to make trading the days into the Brexit referendum easy. We’ll see how today develops.