Market Summary:
Current ICAP Momentum/Trend Model (MOTR) Signal: NEUTRAL (Day Count = 3)
The SPX Index gained 53bps on the day, closing at 6071. The session was extremely volatile with a high/low spread of 59 handles, and open/close spread of 21 handles and multiple 30+ point swings (some of which occurred in literal minutes). The index is now at the upper end of 5770/6100 consolidation range. As I have written previously, I continue to believe this consolidation is actual forming a top (bearish reversal) rather than a continuation pattern (bullish). Momentum and trend indicators continue to fade. However, Spot VIX and VIX term Structure have a bullish posture on the daily count. In my view, this nets out as neutral. The ICAP Momentum/Trend (MOTR) Model signal remains in Neutral. The short-term price volatility has presented some great trading opportunities over the past few weeks. That said, I remain near-term neutral and see longer term risk skewed to the downside. If MOTR does shift to a Negative signal I believe it will be as efficient or more so than the December signal was.
Note: I suggested Gold (GCG5) was a strong strategic Buy on Dec 24. These active contracts were trading at 2629 when I issued that note (First Notice is Jan 31). Those contracts hit a high today at 2836 for a ~8% profit.
Trade Support:
6000: Previous Support
5950: Nov 7 Low
5770: Bottom of Nov 5 / Nov 6 Gap; Jan 13 Low
5700: Oct 31/ Nov 4 Lows
Trade Resistance:
6100: Dec 6 / Jan 21 Highs
6400: Measure Move