Market Summary:
Current ICAP Momentum/Trend Model (MOTR) Signal: NEGATIVE (Day Count = 3)
The SPX index gained 38bps yesterday, closing at 5633. The index remains below the 5700 level as price, momentum and trend all try to gain their footing in unison. Spot VIX remains “risk on” and VIX Term Structure is neutral. The ICAP Momentum/Trend (MOTR) Model signal remains Negative. Whether or not the index is able to break back above 5700 as this bounce progresses will be key in not only the MOTR signal shifting away from Negative but also in what short term upside targets may develop. Either way, I continue to believe that risk overall remains skewed to the downside with a real break below 5500 coming over the next week or so. Near term, I would focus on a broad support/resistance range of 5500/5700.
Trade Support:
5700: Previous Support Sep/Nov (BROKEN)
5500: ~10% Move Peak-to-Trough (TESTED)
5000: ~20% Move Peak-to-Trough
Trade Resistance:
5750: 38.2% Retracement Peak-to-Trough
5893: 50dma
6000: Previous Support
6100: Previous Resistance
6147: All-Time High
