Market Summary:
Current Momentum/Trend Model (MOTR) Signal: NEUTRAL (Day Count = 1)
The SPX Index fell 90bps during yesterday’s session, closing at 5570. The 5600 level broke on both an intraday and closing basis. Price action created an outside reversal day (bearish) with a peak-to-trough move of -1.46%. Yesterday’s candlestick engulfed the previous two sessions but held at the 5560 support level. Remember, 5562 (highlighted in the chart) has been discussed for over a month as it is the Jul 8 (doji) low. My Momentum/Trend Model (MOTR) has shifted to Neutral and closed out the previous Positive signal with a +2.21% gain. As of the writing of this note the S&P 500 futures are trading +28 handles. I will continue to watch for additional degradation in market internals or for a resumed move higher in price and momentum/trend.
On a side note, the VIX and VIX Term Structure have begun to move over the past two sessions. Specifically, Spot VIX rallied trough-to-peak 25% from 14.46 to 18.06. Additionally, the slope of the VIX curve has begun to shift from an equity bullish -10% to an equity neutral 0. Again, not outright negative for stocks yet but certainly a move away from the manic “risk on” spike we have seen since the Aug 5 low.
Trade Support:
5507: 10dma
5500: Jun 20 high and Jul 19 low
5483: 50dma
5400: Prior Support/Resistance
5339: 100dma
5200: Previous Support
5119: Aug 5 low
Trade Resistance:
5622: Jul 17 high
5669: Jul 16 high
