S&P Futures Update for April 28, 2014

The monthly bar below shows overlapping balance areas - a sign of an aging trend. Friday's settle at 1860 keeps the market within the upper 2-month (Mar/Apr) balance. A close below 1839.50 on a monthly basis puts us back in the lower balance. If this occurs, only then does the destination trade become the lower end of the lower balance at 1725. Staying above the 1839-40 area increases the odds of another test of the leg highs at 1892.50 which was made in the overnight session. Also, keep in mind that the all-time highs for all other markets i.e. Russell, Dow and the Nasdaq were also made in the overnight session. It is very rare for lasting leg highs to be made in overnight trading.

 

The weekly bar chart below reveals the following:

1. The market tried to breakout of a 6 week balance and failed.
2. The destination trade became the lower end of the upper balance i.e. 1810.25
3. The Market not only reached its destination but extended the upper balance low to 1803.25
4. Having tested the low end of the upper balance area twice, and finding no acceptance, the market then proceeded to the upper balance high i.e 1880 area
5. The weekly bars from last 2 weeks also show no acceptance in the lower 17-week balance

As of Friday's close, all this market action described above leaves the S&P's in Balance. As mentioned above, staying above the 1839-40 area increases the odds of another test of the leg highs.

 

Following are my observations from the daily profiles shown below:

• We have naked POC's and anomalies above and below Friday's range. 
• For Monday, overlapping to higher Value targets the naked POC at 1871.75 and the recent highs at 1882.50.
• Overlapping to lower Value targets the naked POC at 1849 and the range gap at 1840 - 1840.75. Remember, this level is also the 17-week balance high shown above.