Market Summary:
Current ICAP Momentum/Trend Model (MOTR) Signal: NEGATIVE (Day Count = 6)
The SPX Index broke above the upper band of the current downtrend channel (see chart), briefly hitting its head at 5850, then reversing to close near the lows (back within the channel) at 5813 (down 33bps). I have been writing over the past week that risk is skewed to the downside. On Oct 29 I wrote that “I do believe that we will see one final push out ahead of next Tuesday. My gut is that there will be a final move to derisk, trim and hedge long exposure. I expect 5800 to break and 5733 to be tested before we start filling in ballots on Nov 5”. Although I have received a ton of push back, I have not changed my opinion. The ICAP Momentum/Trend (MOTR) Model remains Negative. Risk remains skewed to the downside. I expect 5800 to be tested and to break leading to an aggressive move down to 5733.
Trade Support:
5800/5796: Oct 9 High
5733: Sep 19 High
5686: Sep 19 Low
5615: Sep 18 Low
Trade Resistance:
5829: 10dma
5878: Projection Level
5970: Projection Level
6000: Even Target
