16 Jan 2022 SPX Weekly - Consolidation

Accuracy: 5/6 (83.3%)

Last Week

My prediction that SPX stay consolidated within and around the same area we see in Nov and Dec, specifically staying above 4600. Which pretty much came true.

From the daily candle chart, we see nice rejection off the 4600 area. It has been a a volatile week as we have economic events that's very related to the inflation topic. The rejection from the key support area kept SPX on the long term uptrend we're still in.

Looking into the 15 minute chart, we see reversal on Monday and Friday forming a higher low. This seems like a bullish sign that SPX will continue upwards.

Upcoming Week

For next week, the structure pretty much remains the same as last week as SPX narrowing down in the consolidation. With Friday's candle that does suggest some upwards movement. On the upside we still have strong resistance at the 4700 area.

Economic Calendar

Note that next week is a shorter week with Monday Holiday (Martin Luther King, Jr. Day).

We do have quite a number of 3 star volatility events next week. But for our current market context, the sensitivity is more on inflation. Next week's event might not have that large of an impact compared to last week's CPI and PPI.

Unless we see super surprising figures, I don't think next week's economic events will be of much impact. Which goes back to, if nothing special, market should slowly move upwards.

Prediction

From technicals, I still think SPX will stay in this consolidated area for next week with a small chance that it might break upwards.

Since the support area remains unchanged. I'll continue the same prediction like last week. One more thing to add is usually prices in hundreds round number also forms a good support area, like 4600 4700, which is the current consolidation range.

SPX to stay above 4600 by end of next week.