Price yesterday made a higher low and higher high
versus Tuesday's candle, but closed lower on the day and below its daily pivot. Price thus far today has opened below its daily pivot and is little-changed from
yesterday's close. We are overdue for a multi-week high to be seen, but until
the MD MA ceases to provide soft support for price, we cannot assume that the
high has been seen.
I have attached a daily chart of crude oil this morning, as the
crude and the S&P have been tracking at an extremely high correlation since the beginning of the year, even down to the hourly
chart. One can see that crude oil has broken above its MW MA and weekly pivot
decisively, indicating that its recent low was not only a MW low but a MM low. We have discussed this possibility for the S&P futures as well, but thus far
price has been reluctant to rally. A break above the MW MA is still possible,
but a close below MD MA and weekly pivot support should force swing traders to
bail on any long positions and go short.
The hourly chart shows price yesterday surging into
its 24Hr high just after noon, two bars earlier than projection. The market then
sold off sharply after the Fed statement to leave rates unchanged. Price found
support for an early 24Hr low at the weekly pivot and was able to climb back
above the daily pivot in overnight trading. With price having backed off below
the daily pivot, it is unclear but suggestive that the overnight high was an
early 24hr high, which would confirm yesterday's high as a MD high. A lower
Session high due near the open would confirm that the 24Hr high has been seen. A 24Hr low is not projected until the close, but the daily cycle has been
running shorter than normal lately, and the weekly pivot could always provide
support for an early 24Hr (and perhaps MD) low.
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