I have been absent the last 2 days of the past week. Lack of liquidity could create disastrous consequences in Pre-Holiday enviroment.
As I´m wiriting this post, the S&P500 futures are still 20 pts. above Friday´s close. We´ll see in the foollowing hours if that gap gets filled
Looking at a traditional view of the SPY, we could say that along the levels I´ve been using as guidelines the index is pretty much in the middle of nowhere: just below 117,60 and above 115,20 which is another important area of support. Those would be some of the key levels I´m going to be considering moving forward.
Last week I talked about what I called the last man standing.
The last man standing -initiated @1066, back on October the 4th- is the only one left. Due to the size of the charts, I am posting two images: one from early October -when those longs were initiated- and one of the current situation, so the realtionship between prices/inventory levels can be appreciatted. Now it is up to the last man standing, to keep support. So far (at 7:30PM, ET) it seems to be holding. Therefore, provided it holds during Asia and London sessions, we could see further upside
As noted on the chart below, the last level of committed longs has been tested and gave up last Friday (the level is marked in white), which was reflected in the 12 point selloff during the early Friday morning. Although the index recovered some of its previous levels, he rally lost momentum, closing off 20 points from 1171.25 highs. This has left a heavy shorted market that could provide some fuel for a rally if new buyers come into the market. This is not a predicition, just a scenario.
Levelwise, see below for some important areas I´ll be watching in the closer term.