SPX weekly chart situation

S&P 500 is at resistance

I found this weekly chart in the chart list showing the old pattern target NFTRH established back in 2020 (it topped a couple hundred points higher). Not coincidentally, 3400 is our minimum bear market target and would represent a round trip back to the pattern top and clear support.

At the moment I am short nothing as I’ve been greedy about wanting to take a short from higher levels based on some daily chart details. But this basic weekly chart does provide a case for shorting now, perhaps to hedge some strategic long positions in various commodity, broad market (incl. China) and a few gold royalty positions. What’s more, if SPX starts to eat away at resistance a short could be covered. I like a clear tolerance point, which in this case is 4200 (+/-).

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This Post Has 6 Comments

  1. Eric M

    Just started a TECS position earlier this morning… will probably add some more if the market goes higher. Already up about 1%… but it is a small position. Was long with TECL and SOXL, but closed those on Monday and just watching the market the last couple of days. It’s looking kind of weak and the VIX is getting low for this move. Really thought the market would have a larger bounce.

    1. Gary

      Agree, VIX is getting down there within its post-November uptrend. I am trying to decide between Tech and SPX. TECS looks nice. But my best position in this market is cash. Lots of it.

      1. Eric M

        Yep… I’m increasing cash to about 75%. I have a large position in bonds, but those haven’t pulled back like I thought…. I’m down around 7% on those. :-( Not sure if I should add more or just let it ride.

        1. Gary

          I only dare have T bills and 1-3yr T bonds right now.

  2. BA Baldwin

    “3400 is our minimum bear market target ”
    With “minimum” do you mean
    (a) the minumum result of a drop from current levels, i.e. you are also thinking about 3200, 3000 etc
    (b) the minimum number you are anticipating the index will drop to, i.e. numbers like 3600, 3800 are also possible?
    Sorry for being so obtuse.

    1. Gary

      I think 3400 is a magnet either sooner or later. If this bounce fails, it could be sooner. If not, later. But the caveat is that in 2020 I was aiming for what looked like a clear support target not far lower than the eventual bottom. But it was never hit. So I mistakenly got greedy waiting for it and did not load as much as I would have had it been hit.

      Long story short, targets are just targets. Not declarations. Can easily go lower or find support higher. If I had to bet now I’d say lower. But WTFDIK?

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