Current ACAP Momentum/Trend Model Signal: NEGATIVE (Day Count = 2)
The SPX index lost 24bps during the Wednesday session, closing well off the intraday low (ref 6343) at 6395. My momentum and trend indicators degraded further as the index faded. The counterbalance here is that both my Spot VIX signal and VIX Term Structure signal remain “risk on”. The ACAP Momentum/Trend Model signal is Negative. This is admittedly a very tough spot for the index. As I have written over the past few days, the index’s inability to re-enter the uptrend channel has been concerning. That concern increased as the index faded further to the 6400 level with an ACAP signal shift to Negative. The break below 6400 yesterday should have been the confirming leg in a move down to 6200. However, the index reversed quickly down ~1% at 6343 and closed right back below 6400 at 6395. The candlestick produced is, in my opinion, slightly bullish amid some very negative signals. All in, I see risk as evenly skewed here. ACAP signal aside for a moment, I would be a buyer above 6400 and a seller below 6343 (Aug 20 low).
Trade Support:
6400: Previous All-Time High (July 28) (BROKEN)
6200: July 7 Low
6147: Previous All-Time High (Feb 19)
6100: Previous Support
6000: Previous Support
Trade Resistance:
6481: All-Time High (Aug 15)
6600: Mid-Point of Uptrend Channel
