11 Sep 2022 SPX Weekly - Bull

Accuracy: 31/36 (86.11%)

SPX below 4100 - Correct

Last Week

I was expecting a struggle at 3900 whether it will support or break through. It rejected nicely and close near 4100.

Look at the daily chart how nice it bounce off the 3900 area support. Despite Powell speech on Thursday causing much volatility, it still ended the week super strong. I think this is a very typical example how technicals can help in adding to the edge in the stock market.

Take a look at the 30 minute chart, the same trend line is on the chart. Look how nicely these trendline get tested and bounce off. I didn't 'just' draw them, look at last week's post these lines were drawn last week.

Next Week

For next week, as usual we first identify the support and resistance area. Look at the green lines, so nice right? Not sure if the market is getting more and more predictable or I'm getting better. But regardless, I should always still think of the unexpected.

So momentum is bullish, bouncing off from a strong uptrend trendline and a past resistance turn support. The very short term momentum will be bullish, since I'm predicting only a week ahead. I'd expect next resistance to be around 4170 followed by 4250, which is the green lines as SPX move up.

Economic Calendar

Looking at the economic calendar for next week, actions start from Tuesday onwards and once again we're having CPI data. The rest of the events are also important inflation data releases but not as huge as CPI.

From the past few CPI releases, it has been telling the story of inflation peaked and coming down. If there's no surprise, I would think it will be probably be a slight bullish event. If CPI is bullish, we may break the 4170 resistance and look to target 4250.

Let's go with another story, for whatever reason this CPI release and market start to go down. We should still find the trendline as support at 3950.

Prediction

As explained above, I'd follow the momentum upwards. Betting on the previous key support of 3900.

SPX above 3900