The SP futures were sitting on inner 2 and 5 day cycle lines around 1 AM ET, but began to sniff a strong open in Europe, and moved up off those support lines so that 2 and 5 day cycle oscillators turned up just as Europe opened at 3 AM. The Spoos crossed the centerlines of both cycles within the first hour of European trading, and have been stuck in a tight range since then around 1216, with both cycles moving sideways, but technically in up phases.
Resistance is indicated at the first inner 2 day cycle line above at 1221. If that’s cleared there would be an opening to move to 1227-29, where the next set of cycle lines, and likely resistance await. The 5 day cycle centerline around 1213 and 2 day cycle centerline near 1210, represent support. If they break, concurrent with rollovers in the cycle indicators, the next big move should be down to the 1200 area, where the next cycle lines converge for support.
On SPX ($SPX) cash as of Friday’s close, resistance was indicated around 1223-25 and support around 1217. The opening print is pushing the top of the range. A move outside that range could lead to an extended move in the same direction. On the cash market, both 2 and 5 day cycle indicators were heading down as of Friday’s close. The 2 day cycle indicators are on the verge of buy signals in the opening minutes. It will depend on whether the opening gain is sustained. Overall it’s a mixed bag as we await a break of the trading range in effect since mid day Friday.
Here’s a look at the Spoos 30 minute bar chart as of 9:32 AM NY time.
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Gold (GC) has been in a nominal 5 day cycle up phase since Thursday. The up phase has been weak, essentially moving sideways. 1610 is now resistance and negative divergences have developed on the oscillators. A drop below the converging 2 and 5 day cycle centerlines at 1590-95 should trigger more downside.
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