Current ICAP Momentum/Trend Model Signal: NEUTRAL (Day Count = 1)
The SPX index gained 70bps on Friday, closing on the highs at 5958. This was an interesting session as internals and price experienced some unexpected negative divergence. Nothing huge, but enough to note. My momentum and trend indicators faded slightly, even as price hit a new “rally” high. My VIX term structure signal is now “risk on”. The ICAP Momentum/Trend Model signal is Positive. The ICAP Momentum/Trend Model signal shifted from Positive to Neutral. As I wrote last week, the index seems poised to test 6000 and we are close. However, price must hold above the May 12 low of 5786. The shift to Neutral on Friday may suggest some consolidation is developing at/near current levels but if more profound weakness develops and 5786 breaks we could see a more significant retracement to the downside. I am handling this shift by talking the ~2% ICAP Model gain off the previous Positive signal and watching.
Note: I am in the process of changing fund structure and taking on additional capital. In the coming weeks Island Capital Investments LLC will become AscalonVI Capital LP. I will keep updates coming as far as official dates and changes. Thank you.
Trade Support:
5750: 38.2% Retracement Peak-to-Trough
5700: Previous Support Sep/Nov
5558: 50dma
5500: ~10% Move Peak-to-Trough
5400: Sep 2024 Lows and Apr 3 Low/Close
Trade Resistance:
6000: Previous Support
6100: Previous Support
6147: All-Time High
