Market Summary:
Current Momentum/Trend Model (MOTR) Signal: NEUTRAL (Day Count = 7)
The SPX closed Friday’s session with a 1% gain, most of which came from an end of day (end of month) rally of over 1% from the session low of 5581 to the closing price of 5648. The late day high for the Index was 5651, just slightly above the identified near term resistance level of 5645 which we have been focused on (see chart). The VIX Index settled down slightly to close at 15.55. Overall, price action was neutral with some volatility and a continued inability to break out above resistance but a continued ability to violate 5600 to the downside. My Momentum/Trend (MOTR) Model remains Neutral for the 7th session as the signal continues to slowly degrade back towards Negative. At the same time, Spot VIX is Negative as the signal there slowly improves towards Positive. These coinciding signals are setting up for a potential drawdown in the SPX and will be watched carefully. Overall, the SPX remains jammed between a near term support/resistance range of 5562/5645. I am watching for either level to break with a confirming MOTR signal. The odds of that being a break to the downside are increasing. I would remain cautious here.
Trade Support:
5610: 10dma
5600: Previous support/resistance
5562: Jul 8 low
5503: 50dma
5500: Jun 20 high and Jul 19 low
Trade Resistance:
5645: Previous support/resistance
5669: Jul 16 high
