FOR FRIDAY: (10/20) Pre-weekend jitters again may create sideways markets with a lot of release due Sunday/Monday. If stocks do not do much to the upside on Friday, they could make new lows on Monday/Tuesday but we are inclined to expect new highs on SP on Friday as the bargain-hunters are back in and greed is unquenchable. We often trade lightly on Fridays but are willing to take some positions home.
DEC. E-MINI S & P 500
S & P ANALYSIS FOR FRIDAY: (10/20) The strong thrust upwards looks like it will go to 2567.50 before a pullback to 2457 or 2555. We had suggested taking partial profits early this morning. The market soared back into the close on hopes for a Powell FOMC chairmanship but the problem is that Friday looks higher and we may have to wait until Monday/Tuesday to get any more bearish energy. NQ failed on the recovery and if the market stays below 2565, still a chance for a push lower. The 4th-wave congestion triangle pattern where Thursday’s lows hold the next few days may be more likely than a chance for new lows to 2530-2. Friday will be critical for not blasting off. While additional resistance is up to 2567 and 2570 on the S & P, the market could stall here.
LONGER-TERM: While we should get a 20- or 30-point pullback, the chance for something bigger may not come until 2580-2600 comes in. Cycles are intense in the world but the market continues to ignore them. At best if we are to get a pullback to 2320, it may come from 2600 and it may take more time to manifest with December being vulnerable with the budget deficit.