2024-12-18 - priceactiontds - daily update - sp500
Good Evening and I hope you are well.
tl;dr
sp500 e-mini futures - Neutral. Selling was too strong to be just a pullback in this bull trend. Best guess is that the trend is over and we are in a huge two-legged correction down to 5800 or lower. 5927 was the low from my W2 and we can expect sideways to up around this price. The lower bull wedge trend line should get a retest.
comment: Bull trend is over. We are likely in a trading range the next weeks until we begin a new bigger bear trend. Bulls can still make a higher but it has gotten very unlikely after today’s selling. Huge follow-through would be down to 5800 but that’s a bit much for now. A bounce could retest the lower bull wedge line around 6000-6050, depending on when we get there, if we get there.
current market cycle: trading range
key levels: 5800 - 6050
bull case: Bulls might be running for the exits. Very interesting day tomorrow if bears can close another one below 6000 or if we trade back up. I would only take longs on very strong momentum. First target for bulls is 6000 and then 6050ish.
Invalidation is below 5800.
bear case: Bears with a huge surprise bar, changing the market character and ending this rally. Now their target is to keep the market below 6000 and then they have a chance of selling down to 5800. It is still somewhat unlikely to see bigger follow-through selling during these weeks of the year but it could happen. Right now it’s best to be flat and wait if bears want more blood.
Invalidation is above 6100.
short term: Neutral. Only small scalps for me to either direction. Can have bigger swings going into Opex on Friday. Expecting a bigger bounce going into the last 2 weeks of December and then much bigger selling in Q1 2025.
medium-long term - Update from 2024-12-15: Will write a new outlook for 2025 next week.
current swing trade: Nope
trade of the day: Nothing. Don’t gamble FOMC or other news releases.
tl;dr
sp500 e-mini futures - Neutral. Selling was too strong to be just a pullback in this bull trend. Best guess is that the trend is over and we are in a huge two-legged correction down to 5800 or lower. 5927 was the low from my W2 and we can expect sideways to up around this price. The lower bull wedge trend line should get a retest.
comment: Bull trend is over. We are likely in a trading range the next weeks until we begin a new bigger bear trend. Bulls can still make a higher but it has gotten very unlikely after today’s selling. Huge follow-through would be down to 5800 but that’s a bit much for now. A bounce could retest the lower bull wedge line around 6000-6050, depending on when we get there, if we get there.
current market cycle: trading range
key levels: 5800 - 6050
bull case: Bulls might be running for the exits. Very interesting day tomorrow if bears can close another one below 6000 or if we trade back up. I would only take longs on very strong momentum. First target for bulls is 6000 and then 6050ish.
Invalidation is below 5800.
bear case: Bears with a huge surprise bar, changing the market character and ending this rally. Now their target is to keep the market below 6000 and then they have a chance of selling down to 5800. It is still somewhat unlikely to see bigger follow-through selling during these weeks of the year but it could happen. Right now it’s best to be flat and wait if bears want more blood.
Invalidation is above 6100.
short term: Neutral. Only small scalps for me to either direction. Can have bigger swings going into Opex on Friday. Expecting a bigger bounce going into the last 2 weeks of December and then much bigger selling in Q1 2025.
medium-long term - Update from 2024-12-15: Will write a new outlook for 2025 next week.
current swing trade: Nope
trade of the day: Nothing. Don’t gamble FOMC or other news releases.
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