S&P 500 Jan 10th to Jan 14th Outlook
Recap of Last Week
Opened close to 50% upside expansion and moved immediately towards the 100% upside expansion target. Once the market failed to hold above the green zone, it dropped all the way back to the previous week (also month and year) high – standard STOPD move. First bounce target of 50% of the week tagged, then 1-2-3 buy to tag the week high. There was not enough participation in the second half of the week and the higher low staged from 50% of the week failed to push the market higher. That resulted in a quick drop back to previous week high. The controlling parties showed their hands and close the week above midpoint.
Next Week Outlook
It is rare that the first week of the year holding fine at previous year high does not produce a significant rally. We just get one this year. That means it can be a year of tight range with limited up and down side movements.
The open gap at high 1250s should act as support even after it is filled.
The more likely scenario is that the previous week high to be tagged quickly. If it turns into support, 100% expansion to the upside at 1290 or higher is in play.