Market Summary:
Current Momentum/Trend Model (MOTR) Signal: POSITIVE (Day Count = 3)
The SPX Index was relatively subdued yesterday, quietly gaining 28bps and achieving an all-time closing high of 5718. Spot VIX remains pressed, closing at 15.89 as Term Structure slides deeper into “risk on” territory. My ICAP Momentum/Trend (MOTR) Model Signal remains Positive for the third day. The current return on a closing basis is a modest 10bps. That said, I remain focused on a potential breakout to the upside through previously identified resistance at 5733 (Sep 19 High). In fact, I wrote yesterday that “The near-term support/resistance range which I am focused on is 5615/5733 (highlighted on chart). A breakout above 5733 with a Positive (confirming) MOTR Signal would be very bullish. There I would add significantly to my long exposure. Ahead of that I am net long, paired down and watching”. As the Index has done some good work within the Sep 19 bar range, I am tightening that support resistance range of focus to 5686/5733 (see chart). Based on recent price action, internals, Spot VIX levels, VIX Term Structure and the Positive MOTR Signal I remain net long but paired down. I am focused on adding to those longs on a breakout above 5733 while remaining conscious of the fact that the Index needs to hold above 5686 to keep the current bullish near-term structure intact.
Trade Support:
5686: Sep 19 Low
5669: Jul 16/Sep 17 High
5645: Previous Resistance; Sep 11 High (ref 5642)
5629: 10dma
5615: Sep 18 Low
5600: Previous Support/Resistance
5562: Jul 8 low
Trade Resistance:
5733: Sep 19 High
5878: Projection Level
