FOR TUESDAY: (11/21) Always worried about thin holiday conditions which make stop placement precarious. We still like short gold and silver and long crude and will go with those new trades. We also like long stocks but want to make sure there are not any nasty surprises in the morning.
DEC. E-MINI S & P 500
S & P ANALYSIS FOR TUESDAY: (11/21) We had hoped for a congestive few days between 2562-2585 but probably won’t get it. In the end, with thin holiday volume, the market should reach up to 2605 on futures with extensions up to 2617 on cash which will be close on futures. Ideally we could see a top by Monday with end of the month profit-taking likely into Nov. 30. These markets will often do a lot on Wednesday night/Thursday/Thursday night around Thanksgiving and you have to take home length to catch it. We had thought that Tuesday might be the strongest day higher.
Resistance overnight at 2689 and support at 2577-8. May have to buy that dip. The worst-case scenario would be an overnight dip to 2562.50, which would have to be bought also.
OVERALL: The market did generate a negative weekly chart close and a first Hindenburg signal so we’re right about topping action here but it will always go a bit more than expected and these 4th-wave fake-outs are frustrating. The divergent high to 2607 may come and maybe cash will get up to 2617. We’re seeing at least a 110-point fall to 2485. Lower target is possible to 2400-2385. It does look like a Christmas recovery will happen the week of Dec. 11-15 and possibly into the Dec. 22.
CYCLES OVERVIEW: Higher Tuesday; sideways to higher Wednesday/Thursday; pulling back Friday; higher Monday.