ONE44 Weekly Outlook
The SP was only able to get down to the first of the key long term levels at 1260.00 on Thursday, this is the 1×1 angle that started out at 1257.00 on Monday. The June contract traded as low as 1258.00 and the September contract which is now the nearby contract traded as low as 1252.25. While the market could turn from hitting just the first of the key levels, it would take a close above 1279.50 and then 1296.25 to tell us that the low is in for now and to look for a rally that takes the market to new highs for the year. Until it can close above these levels we would still watch for the SP to trade down to and through more of the long term levels that are now at 1256.00, this is the 200 day average, 1246.00 is the last 1×1 angle below and the two levels that will remain constant are the Square of 9 Gann level at 1242.00 and the 38% retracement of the move from 1373.50 down to 1002.75 at 1231.75. All of these levels are so key to the long term trend that two closes below the last 1×1 angle at 1246.00 would tell us that the long term trend is turning very negative. Two closes below the 1×1 would usually be enough to say it has been violated, but because of the 38% retracement of such a key move is just below the 1×1 we would also want to see it close below 1231.75 when it has those two closes below the 1×1 to confirm it from a different method. As always ONE44 keeps everyone up on the short term opportunities throughout the week on the platform.
The NASDAQ has continued to close below its key 1×1 angle at 2233.00, the downside target remains at 2149.00. The extreme 2×1 angle coming up is now up to 2164.00. Because we would still like to see the SP trade down to the bigger levels below, we would also like to see the NASDAQ hitting the downside target of 2149.00 at the same time. The best scenario would be for the NASDAQ to trade below the 2×1 angle and get down to the 2149.00 target then close back above the 2×1. If this does happen there will be a couple levels above that they will need to close through to confirm that a rally from this area should take them back to the highs for the year. With two closes below the 2149.00 area the targets will be 1976.00 and then the 1×1 angle at 1950.00.
The Euro hit the downside target of 1.4202 then traded below the 1×1 angle at 1.4110 and closing back above the 1×1 in that same day it gave us a buy signal. In one day it is already at 38% back of the break at 1.4273, two closes above this level and the target will be the 1×1 above at 1.4600, failing from this level after hitting the 1×1 will be negative and you should look for a break down to the last 1×1 below at 1.4030, closing below here and the target becomes 1.3755, this is the level that would have to be taken out to turn the long term trend very negative.
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