Tuesday 5/26/2015

As we head into the last trading week of May, the monthly chart shows price having made a higher low and higher high versus last month. Price is overdue for a multi-year high to be seen, and the multi-year low is projected for June. It is possible price made its MY high this month and will now pull back into a MY low, or price could be doing an inversion and will make its high at the time of the projected low. The latter would generally be more bearish as the decline which follows generally lasts a half cycle, meaning seven or eight months of falling prices. In any case, this current rally is long in the tooth and risk is very much heightened, but as long as price continues to find support on the MM MA on a closing basis, the MY cycle continues up.

The weekly chart shows price last week making a higher high and higher low versus the prior week and making an all-time high in the process. Price early in this week's candle opened above the weekly pivot but is currently trading below it. A multi-month high is projected for mid-June, and as long as price continues to find support on the MW MA on a closing basis, the MM cycle continues up.

The daily chart shows price last week having made a very rare Monday low/Tuesday high pattern. While unable to see when this last happened in the S&P futures, I was able to do a quick search of the pattern on the S&P 500 index and found it last happened in August of 2012; interestingly, the index itself did not see the pattern last week, but instead saw a Monday low/Wednesday high pattern, which often marks multi-week highs. Price today has opened above the daily pivot but is currently trading below the daily pivot, weekly pivot, and the MD MA.  

Price closed below the MD MA on Friday and today's action is bending the MD MA downward. This is price action indicative of being on the downside of the multi-week cycle, and I have marked Tuesday's high as a potential MW high. The MW low is projected for Thursday. While we would generally expect price to find support for the MW low on the weekly pivot or the MW MA, lately price has tested the MM MA or monthly pivot before finding support for the MW low.  If we are indeed on the downside of the MW cycle as it appears, the weekly pivot and MD MA should provide resistance to price until the MW is found.

The hourly chart shows price making a 24Hr high yesterday at MD MA resistance, classic behavior on the downside of the multi-week cycle. Price has since made two lower session highs under 24Hr MA resistance is currently testing the prior session low near MW MA support. The 24Hr low is projected for noon, though higher timeframe support such has the MW MA could provide support for this low to be made early. Price is also on the downside of the MD cycle (the MD low is projected for near the close today), but the MW MA could also provide support for this cycle's low as well.