Market Summary:
Current ICAP Momentum/Trend Model (MOTR) Signal: NEGATIVE (Day Count = 2)
The SPX Index closed yesterday’s session up 40bps at 5916. The Index was weak early in the session as I expected, breaking below support at 5864 and hitting a low of 5855. This low essentially matched the Nov 15 low of 5853. The Index then reversed hard off this level with increased volume and a hard fade in Spot VIX. I did not expect this. While I respect the intraday reversal, I am skeptical that this move holds. The ICAP Momentum/Trend (MOTR) Model remains Negative. Bottom line, the Index is in the process of filling gaps to the downside. I would look for follow through over the next few sessions with a focus on the support/resistance range of 5864/5947. In my opinion risk remains skewed to the downside but a real break above 5947 with confirming internals would change that view.
Trade Support:
5976: Nov 9 Open/Low (broken)
5947: Nov 7 Open/Low (broken)
5864: Nov 6 Open/Low (broken – intraday)
5783: Nov 5 High
5733: Sep 19 High
Trade Resistance:
6000: Even Target
6017: Nov 11 High
