FOR MONDAY: (2/6) Hard to take too much home over the weekend given wild tweets from Trump, saber-rattling with Iran and China back on the offensive raising interest rates. We still feel good about short gold next week and long dollars but don’t expect any easy trading in Feb and the wheels will start coming off soon probably by the week of Feb. 12.
MARCH E-MINI S & P 500
SWING TRADING RECOMMENDATION: Buy March e-mini S & P at 2285.75 with a 2279 stop.
S&P ANALYSIS FOR MONDAY: (2/6) S & P above 2287 is projecting 2295 with pullbacks to 2288.50 and 2285 probably holding on Sunday. First pattern completion within a few days to 2210 and then a pullback and then an extended target is up to 2317-8 into early next week or as late as Feb. 11. We’ve learned not to be a martyr about top-picking and while we’re getting close to a key weekly chart high, it’s not quite in yet. Still, 2310 will be hard to take out right away and we won’t rule out 2332 on cash to have an absolute completion. We’re open to buying pullbacks on Sunday night or early Monday if nothing wild happens over the weekend.
OVERALL: We’re still open to seeing slight new highs or secondary highs toward 2310, Overall, we continue to look for topping action and a 100-point S & P correction over the next few months. Market a bit too oversold to jump into sales without a recovery. Given the atmosphere out there, we wonder if it will be more. Open to a major short into Feb. 26-28 but have to pick your spots carefully.
NEAR TERM: It’s possible that a key high for the winter could be in by Feb 6-10 and that highs into the week of Feb. 6-10 are secondary highs. We’re still open to a major pattern completion on cash at 2332 into early Feb but it’s probably down to 30% chance to happen and 2309 would be welcome. The last pullback 2nd wave on the weekly chart was a congestive fall over 10 weeks. If that is the case again, it could be that we have a 100-point congestive pullback into the week of April 9.
CYCLES OVERVIEW: Higher Monday; topping Tuesday.
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