E SPX, Gold, Oil And G6 Targets For The Week Of December 10

In a short, but action packed week, the SPX reached both our upside and downside targets. As mentioned last week, there’s a well defined support/resistance zone in play, and the longer-term trend will be determined by the ability of the SPX to break above the November 7 high (bullish) or below the November 23 low (bearish).

For the time-being, market breadth and sentiment indicators are all oversold which, barring some catastrophic news over the week-end,  favors a rebound early next week.

After crossing the lower weekly target several times during the second half of the week, the SPX broke below it on Friday and dropped an additional 60 points. By definition, the weekly targets are designed to capture 80% of future price moves (the current rate is 85%), which raises the question of how to determine a lower/higher target on the rare occasions when an intraweek breakout/breakdown occurs. There are several ways of doing this (higher time-frame targets, channels, angles, technical support/resistance levels, etc.) but in addition, it's worth noting that the SPX found support at the daily lower target levels (dotted horizontal lines) both on Thursday:

and on Friday:

The way they differ from channels is that they are fixed and predetermined, and don’t change values during the day.

Current signals*: Daily Sell, Weekly Sell, Monthly Sell

Weekly Buy pivot at 2660.

The projected trading range for next week for SPX is 2600-2750.

Oil continues trading above support at $50 on news of an OPEC supply cut deal. We would caution, however, that OPEC members are notorious quota cheaters and any such trial balloons should be taken  with a grain of salt.

Current signals: Daily Buy/Hold, Weekly Sell.

Weekly Sell pivot at 50

The projected trading range for Oil for next week is 49.25 – 52.5:

Gold remained on a buy signal and broke above the weekly upside target.  

Current signals: Daily Buy, Weekly Buy

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