Market Summary:
Current ICAP Momentum/Trend Model (MOTR) Signal: NEGATIVE (Day Count = 6)
The SPX Index hit a low of 5837 during Friday’s session and then rallied to close +1.59% at 5954. This “relief rally” makes sense as the index has sold off over 5% in just seven sessions. The recent slide was as expected as four of five downside support levels have been taken out (including the 5850/5900 gap) leaving just 5700 untouched and below. Momentum and trend indicators remain negative. Spot VIX and VIX term structure remains “risk off” according to my count. The ICAP Momentum/Trend (MOTR) Model signal remains Negative. While I would not be surprised to see the SPX index rally to and potentially slightly above the 6000 level, I remain a seller of the index and a buyer of volatility for the near term. The greater risk remains skewed to the downside.
Trade Support:
6130: Previous Resistance (BROKEN)
6100: Previous Resistance (BROKEN)
6000: Previous Support (BROKEN)
5850/5900: Jan 14 / Jan 15 Gap (BROKEN)
5700: Previous Support Sep/Oct
Trade Resistance:
6250: Measured Move
6400: Measured Move
