Closing Range
On
Friday, the SPX
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$SPX.X |
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PowerRating) gave us
an opening range Flip Top breakout above
905.60 which only lasted three bars. That’s utilizing the five-minute charts.
Then there was a reversal of the opening range, trading below 901.10 to the
intraday low of 891.62. This was essentially the end of the trading day, as the
SPX formed an 897 – 892 Slim Jim into the close from 11:00 a.m. ET. The .618
retracement between 769 – 965 is 890. That closing range becomes your first
inflection point both ways today. The Nov. 6 925.66 high for the SPX is
significant in both price, as 923 is the .786 retracement to 965, and also
symmetry of time on both a short-term and longer-term basis. This to me means
the very short-term bias is down.Â
Friday was not a heavy
day, as NYSE volume was 1.4 billion, a volume ratio of 26, and breadth -581.
Both the SPX and Dow
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$INDU |
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PowerRating) ended -0.6%, with the Nasdaq -1.3%. The
(
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PowerRating)s hit an intraday low of 23.70, down from the 27.18 rally high. The .38
retracement to the 17.32 low is 23.40, the .50 retracement is 22.25, and the
.618 is 21.09. They closed at 24.40. The 20-day EMA is 23.61, the 50-day EMA
23.32, and are both rising, so there is confluence with the .38 retracement of
23.40. After the 57% rally, the semis should be a primary trading focus on a
daily basis.
If the SPX comes out of
the Slim Jim top at 897 and then above the daily pivot of 899, it runs into a
confluence of resistance from 900 to last week’s high of 907.44. On the downside
for the SPX, below the 890 .618 retracement is the 20-day EMA at 888 and the
50-day EMA at 882.37. The zone between 855 and 870 has a confluence of support,
but 866 is only the .38 retracement to the 769 low, and I would like to see more
of a retracement to give this market more of a chance to continue the move.
On the stock screens this
morning, you see that the
(
THC |
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PowerRating) implosion has dragged down most of that
sector and also the Nasdaq 100 low-priced dogs that have been running took the
hit on Friday, with more to come this week. The primary focus now should be
framing the major indices, HOLDRs or stocks that you are interested in and watch
how they approach your levels. We are looking for 1,2,3 higher bottoms on a
retracement to 769, then another up leg above 926, which should carry above 965
if, in fact, we have seen the bottom. I have no interest in single stock futures
until after I observe how they trade for a reasonable period of time, so please,
no e-mails on the subject.
Have a good trading day.
Five-minute chart of
Friday’s SPX with 8-, 20-,
60- and 260-period
EMAs
Five-minute chart of
Friday’s NYSE TICKS