SPX made a complicated but classic text-book movement in the past couple of months. The June high of 1130 becomes a significant resistance level for the time being, as you can see SPX bended down in the past couple of days. Also, a nice wedge has been formed since end of June. Another push towards the upper line of the wedge will lift SPX through 1130, so I won't be surprised to see the June high taken out marginally. A more critical level to watch is the May high of 1175. As long as this level stays hold, the trend is down. Theoraticlly, a break out is expected at the end of the wedge. I am more inclined to express a bearish view.
A great signal that I have been using to track SPX is USD/CAD. On last Friday, it formed a powerful bullish candle. The previous two times it touched this level, it bounced right back with long white candles and managed to make sustained upward move thereafter. This time may not be any different. My view is we may see a break up in USD/CAD in next week, which will drag down SPX significantly.
No comments:
Post a Comment