S&P 2015-02-09

Barrometrics Views: S&P 2015-02-09

We were spot on the Non-Farm and the S&P reaction to it.

Figure 1 shows the price action. After heading up following the number, the S&P sold off  after 12:30 PM EST. Where does the price action leave us?

I see three congestion zones forming in three timeframes:

  1. 13-week swing
  2. 18-day swing
  3.  5-day swing

Figure 2 is the 13-week congestion. Acceptance below  1994 would trigger an Upthrust Change in Trend pattern projecting a minimum target to the Primary Buy Zone, 1831 to 1820. If a change in trend does occur, my target for that is around 1400.

An upside breakout is also possible I have Ray Wave projections suggesting a top-out at 2259 to 2409.

Figure 3 shows an 18-day swing congestion. We have done the minimum retracement, though usually a move to 2078 would be more satisfying. In this case, there is a potential H&S, best for symmetry would also be a move to 2078; but stopping at these levels would not surprise.

Finally Figure 4 shows the 5-day swing congestion. Acceptance below 2054 would trigger a sell with a target at 1980 to 1992.

That’s the technical picture. But, for me, until I see clear signal that the QE myth has been dispelled (a technical sell trigger would now suffice), I’ll favour the long side. So, am looking for an upside breakout, and retest for a long entry. Acceptance below 2054 would be a warning that the long scenario is wrong. Acceptance below 1994 would confirm.

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Figure 1 S&P 30-min

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FIGURE 2 13-week

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FIGURE 3 18-day

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FIGURE 4 05-day