2 Jan 2022 SPX Weekly - New Year

Accuracy: 3/4 (75%)

Last Week

In last week's prediction, I mentioned SPX to stay above 4666. It appears that SPX had a strong final week for the year closing at 4766, exactly 100 points above my conservative price. I'll count that to my accuracy +1.

From the daily candle chart of SPX, we can see the big bullish candle on Monday that continued the momentum of the week before and hit a clean ATH close. Followed by 3 days trading in a relatively small range compared to such a big prior move. Towards the end of the week, we do see a slight pull back closing near half of Monday's bullish candle.

Going in deeper with the 30 minute candle chart, we see that SPX is consolidating within the 4761 - 4806 range through Tuesday to Thursday. At the end of Thursday, it did closed slightly below this range giving an early sign of breaking downwards. Then on the start of Friday, we see it rejecting the 4761 area several times. Followed by a strong liquidation towards the final hour of the year closing at 4766.

Just to give another perspective, SPX did a double top at ATH of 4806 area. Followed by lower highs on Thursday and Friday. To me this is a sign of the start of a short term downtrend.

Upcoming Week

The upcoming week is the first week of 2022. On this calendar flip week, there may be more unexpected price movements.

From the last week's analysis, I do see a possible short term downtrend into the next week at least towards the 4700 area. I also drew a uptrend resistance line that projects the highest point by next Friday is 4825.

So my story for next week is a quick dip towards 4700 area before moving higher.

Economic Calendar

Looking at the economic calendar, there's 3 star volatility events almost everyday. Not all volatility events are bearish but to me it increases the chance of bears. As the market usually grinds up when there's nothing happening, times where things happen are times it does its correction.

So this also kinda align with my technical analysis that there may be a dip for next week.

Prediction

Since I lean towards the bearish side and have an upside resistance, I will put next weeks prediction on the upside instead with some conservative buffer.

SPX to close below 4830 by the end of next week.