Wednesday Update – In the Low Window in Indexes and Gold

23 Comments / Video Updates / By

Today’s update covers SPX, ES, RUT, Oil, USD, Gold and a cycle chart on the indexes.

SPX – So far so good . . . Have hit the lows expected in Chart Chat in SPX and RUT and looking for a three wave sequence back test – need a marginal new high before we see the next lower low. Today was a Bear market rally imho. WE ARE IN THE MIDDLE OF THE LOW WINDOW TIME WISE – bears have little time left. If the formation is going lower? bears have until the end of this week to get it done. Still expecting new highs in Sept/Oct, nothing has changed bigger picture, then major low in March 2016.

DX – Have broken the rising channel as per Chart Chat and have hit fib support. Expecting three wave back test then lower into 94’s.

Gold – Looks like we are ready for a bounce to higher targets – 1136ish area. We have divergence and a lower low and have exited the low window so 1065 was close but no cigar. One more legg down after we see what the gold bulls have, squeezy conditions exists so careful short there. Next low is a buy in mid August, a significant low.

CL – Oil fixin to bounce in three waves then lower to 45.80-45.56ish as 5=1 target – from there a large? bounce and as stated, on the large bounce if bulls cannot break 54.25, we will see lower lows and this next legg down can get ugly. Watch the 52.50-53.00 area as resistance. Squeezy conditions exist for a bear market rally.

Don’t forget to sign up for Chart Chat for this Sunday, 4pm CST.

Good luck the rest of this week. 🙂

UPDATE 7/29 8:00pm

SPX 1 hour bars

Quick update – BIG inflection point here. Bear’s last stand. They must come out swinging tomorrow. Note the pitchfork and resistance. Break the pitchfork to the upside and cycle low is done. Likely we get a retrace tomorrow to either test the middle daily bollinger or as far as the monthly pivot (blue line). Break the monthly and we open 2040 and lower to 2028 quickly. Bull must find support tomorrow. If found we head higher into mid September.

E-mini below: Rising wedge has 70% chance of a break down. Watch 2108 as 5=1 target. Divergence decent here.

Emini S&P

Written by:

Stan Nabozny

Stan is a 20 year retail trading veteran, CTA (Commodity Trading Advisor) and Co-Founder of The Art of Chart. His specialties include using futures and options to trade Energies, Precious Metals, Equities, Currencies, Bonds, Softs, Grains and other commodities. Stan believes that Risk Management and Trader Psychology are more important that technical analysis and spends his time teaching and coaching other traders on these topics. Stan uses various trading systems and technical analysis approaches that integrate time and price in his work. See his latest articles here and www.huffingtonpost.com.

29th Jul 2015

23 thoughts on “Wednesday Update – In the Low Window in Indexes and Gold”

  2. Frank

    Stan,
    Looked at the /es a few minutes ago and saw the high was 2.25. Since it didn’t break the 2.50 and assuming it doesn’t break the 2.50 for the rest of the day, does this mean you’re still looking for the retracement you discussed? Great video this am!
    Frank

  3. mike7x

    Hey Stan, thanks for the vids. Great job. Is the bear case toast now? All upper resistance levels seem broken through. With FOMC meetings weeks, the day after can produce big swings. If there is a pull-back tomorrow, how low do you think the SPX might go? Lastly, do the bears still have any real chance?

    1. stannabozny

      Hey John – My overall philosophy – Indexes are mostly a bullish trade, at least since 1932 – occasional corrections which are worth looking for because you can make in a week what you make in a month if you trade them well. I’m not a perma-bull, just a two sided trader.

      Bull case now gaining momentum, R1 needs to go tomorrow to confirm. I see us at an inflection point, last chance bears tonight/tomorrow. Am short the close today.

      1. mike7x

        VIX traded below 12 again today and closed ~12.50. The last 3 times this happened (all since May) the SPX moved lower in corrective action. An inflection point is right! Should know the direction by EOD tomorrow. (FB lower AH.) Let us know if you think the inflection point has been resolved tomorrow. GL on your short. I already had a small one myself. 😉

          1. mike7x

            Thanks much for the updated charts Stan! Very useful!! Based on your charts, VIX trading today, FB lower AH, and normal post-FOMC meeting reversals (which happen frequently), I think the SPX tests the 2085 & 2070 levels. Good shot at retesting 2040’s also. Then maybe another inflection point. Like you said, bears have a shot but they need to act tomorrow. Should be a very interesting day.

            I agree with your earlier mentioned long-term target of Primary IV not starting until early-mid 2016. BUT, a strong downtrend below 1990’s could mean it’s already started. Some Elliot Wavers already have us in P4 or even P5. Interesting times for this long bull market (without a significant correction since 2011). 🙂

      2. John Francis (@d333gs)

        I’m with you 100% and learning tons , your 2102 area was perfect , it is amazing how the market managed to put in little spikes into 03 04 area just enough to cause doubt , hit stop-losses on shorts and trigger long positions ………psychological terrorism programmed into algorithms…

  7. stannabozny

    Have updated the post with a chart – please see it at the bottom of the post. This is a big inflection point here – bears must perform tomorrow or we go higher into mid sept.

  13. muradekmekci

    Declining resistance on Stan’ s 1 hour SPX chart seems to have been broken.. However, as far as I could follow, RSI on the same chart not confirming this break up..

  14. mike7x

    Boring! Are we gonna be in another range-bound market until the next FOMC meeting? VIX in low 12’s again suggest another significant pull-back. BUT…

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