Short-Term Top Imminent

Expecting a more important top in this time frame was due, in part, to negative divergence showing at the weekly, daily, and hourly time frames -- an unusual occurrence. However, this past week the daily CCI surged to its highest level since August, wiping out any expectation of important weakness directly ahead.  

SPX Hourly Chart 

Since mid-November, SPX has been traveling in a narrow, shallow channel which was breached on the downside on two separate occasions, with prices finding support on the 200-hour MA and immediately bouncing back inside the channel.

The index is preparing to do the same thing on the upside, punching through the top of the channel to reach its ~3850 short-term target before perhaps retracing down to the bottom of the channel once again, and at least into the low of the 20-td cycle due on Jan. 18-Jan. 20.

After this, it should continue its path higher toward the next price target of ~4150 which, upon completion, should bring the most important correction since early November. Even this would not be expected to mark the top of the 2009 bull market which could come at a higher level in April, just ahead of a substantial decline resulting from the bottoming of the seven-year cycle (2002-2009-2016-2023).

UUP (Dollar ETF) Weekly Chart

UUP is doing what the oscillator pattern anticipated, namely finding support in the vicinity of its long-term channel trend line. This could bring a rally extending into the blue 50-week MA over the next few weeks, and perhaps to the top of the corrective channel trend line just beyond.  

GLD (Gold) Weekly Chart

GLD found support on its weekly 50-MA and retraced .618 of its correction before finding resistance at a former short-term high and pulling back. More corrective action is likely needed for the next couple of weeks. So long as it remains above the blue 60-week MA where it found support on the last pull-back, GLD should continue to consolidate in preparation for its next advance.  

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Charts courtesy of QCharts.

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