FOR MONDAY: (11/6) Cycles are positive mostly on Monday and the worst of the general cycles that we have gone through are ending over the weekend. That may give bulls a renewed reason to buy stocks. We have a low confidence read on the week but we have completed research on cycles and patterns into Christmas and have reported below.
DEC. E-MINI S & P 500
S & P ANALYSIS FOR MONDAY: (11/6) Given Nasdaq’s reaction off of the Wednesday night low and the SP above 2580, we will assume that the correction was over Wednesday night and that there are still two new highs coming. First resistance at 2600-4 on futures and then cash projects 2617-8, which could push futures up to 2620. We’re open for another week up because it might take that long to get that market to those levels, with the earliest time window during the early part of the week.
SHORT-TERM (11/3) Stocks are running out of time at publication. Upper cash pattern completions are at 2617-8. We could see the market hold up as late as Nov. 13 but the market looks lower into Nov. 17 and while the market is often up into Thanksgiving, at best it looks sideways to lower and then lower into Dec. 6-8 around the budget crisis deadline. It does look like a Christmas recovery will happen the week of Dec. 11-15 and possibly into the Dec. 22.
OVERALL: We’ve been watching 2600-4 as a key pattern completion for futures but that could extend to 2615-20 based on cash patterns. At the moment, we can only count on a 110-point pullback into December, which would be less than 5%. We think that 2490-2500 will hold dips this year.
CYCLES OVERVIEW: Higher Monday and probably Tuesday/Wednesday.
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