18 Dec 2022 SPX Weekly - World Cup
I realised I missed last week SPX weekly! Mind overly occupied with too many things. Anticipating CPI, FOMC, doing complex backtests, down with some slight cough, and World Cup! Anyway back to business.
Accuracy: 41/47 (87.23%)
SPX above 3800 - Correct
Quick recap on the week before, SPX supported right around 3900 and close above it on 9 Nov Friday. So that week got correct on that.
Last Week
Lets talk about last week, realised I missed the very important week with CPI and FOMC. From the above weekly chart, we see the huge wick rejecting the downtrend line.
On the daily chart, we see that happened right on CPI. Upon CPI release in premarket, SPX shot up over 100 points. But once market open it started to grind downwards. Then follow by the next day FOMC which seems to send the market downwards even more despite CPI showing inflation is coming down faster than expected and eventually broke below 3900 and close in this new area.
Let's have a closer look on the 30min chart, we see SPX has been consolidating in the 3900-4000 area for few weeks until last week. We had a break upwards from CPI but immediately rejected creating what some call it a 'fake breakout' pattern followed by diving down breaking the 3900 support.
Next Week
Putting in the usual 3 potential scenario:
- Green - 3900-3920 now acts as the potential upside resistance after breaking downwards. If we were to have some slight pull back up, this area should see some resistance or slowing down. So in a 1 week prediction perspective, this area is something to be of direct concern.
- Yellow - After such huge moves last week, CPI shooting up and FOMC pushing it down. There might be some slow down consolidation in the current 3850 area. Market might take a step back to digest what really happened.
- Red - Continue this downward momentum towards 3750.
Also marked out the 4000 point where it meets the downtrend resistance line. I guess this will be my safer target area to look at. As we're now on the short term downwards trend.
Economic Calendar
After a big week with CPI and FOMC, the following week usually would be smaller moves with smaller events. All those that relates to the inflation and interests rate will more or less do some slight impact to the market. But I'll expect a much smaller move compared to last week unless something really surprising came about.
Prediction
Straightforward, follow the momentum. 4000 being a significant number to contest.
SPX below 4000
Another prediction (or rather just to support)
Argentina Wins World Cup
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