FOR WEDNESDAY: (1/10) Breakout on crude today is a game changer but we do have a cycle high due by Thursday and a 2-week correction coming but inflation is back. S & P has its best opening for the year in 30 years and we’re not going to throw cold water on this wonderful event. Our work had suggested a pullback is due but will it be much and matter if 2780 comes in first?
MARCH E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S & P ANALYSIS FOR WEDNESDAY: (1/10) Stocks got close to the 2762 area and gave back most of it but still closed up on the day and that makes this one of the best starts to the year in 30 years in terms of % gains already! We continue to look closely at cycles and can see the market still holding up and breaking at the end of the week. Support at 2747.50 and 2740 still could be followed by a move to 2783.50. At a point where it’s hard to chase this market but that is the case everyday.
Will the 70-point correction start from 2780? Market is tiring and letting off steam today is healthy. Some cycles point lower into Friday but we always watch pattern completion. Pointless to look for shorts. The 5th-wave target on the hourly is now up to 2783.
OVERALL: Patterns suggest the need for 70-100 point pullback and that could start next week but it will be inconsequential with such a strong start to the year. The most bullish pattern would allow only a 30-point pullback and then a 100+plus point move up. Luckily, we’re luckily long from our ETF timer via SSO from the close of 2017 and that position is doing very well. Sometimes you just have to jump feet first into bull markets.
SHORT-TERM: (1/05) We can see the market holding up a few more days but still looks lower into Jan. 12 and Jan. 19. Not sure what will happen but we do have the debt ceiling coming up again for Jan. 19. It does then seem like a 3-week correction into Jan. 24-25 is likely with a recovery into Feb. 2.
CYCLE SYNTHESIS: Higher Wednesday; lower into Jan. 12; lower into Jan. 19.
