Current ACAP Momentum/Trend Model Signal: POSITIVE (Day Count = 11)
The SPX index lost 28bps on the session, closing at 6637. The index tested and held the 10dma (ref 6627) with a low of 6621 as price continues to work between it (the 10dma) and the Upper Bolinger Band. Momentum and trend indicators faded but remain constructive. My Spot VIX signal remains “neutral”. My VIX Term Structure signal remains “risk on”. The ACAP Momentum/Trend Model signal remains Positive. As I wrote yesterday, “I don’t see a significant fade developing yet. The 6600 level could get tested but the current setup would suggest a hold there and rally back towards 6700. Risk remains skewed to the upside for the near term.” This is exactly what we saw today with a low of 6621 and a reversal into the close which I expect to continue as the index moves back towards 6700. This view would change if we see the ACAP signal shift down to Neutral. I will be watching.
Trade Support:
6600: Previous Resistance
6400: Previous All-Time High (July 28)
6200: July 7 Low
6147: Previous All-Time High (Feb 19)
Trade Resistance:
6802: Fibonacci Projection (123.6%)
7035: Fibonacci Projection (138.2%)
