Looking at SPX first. A couple of weeks ago I mentioned if the SPX could get to the LVNs from around 3980 then the path of least resistance will be up and here we are trading 4k+.
However it's not that simple from here as SPX is coming into some heavy resistance.
The major resistance level that will be programmed into a ton of algos will be the 200dMA - it's currently at 4056. If price can breach the 200 then SPX will run into some heavy overhead resistance via the way of the HVN from 4100-4160. This a zone of heavy insto positioning as it also coincides with the upper edge of the descending channel thats been formed for over a year. This looks a likely point for a reversal if it makes it that far.
Price has been moving up but the trend is still down so favouritism goes to the bears for the week ahead, however there are some events that may well surprise to the upside and that would create quite a short burn indeed - obviously JPow features heavily again. Although SPX has seen some good gains of late it's not quite in the overbought category yet, so perhaps there is a little more for this run?
My take on current level is I believe there are an absolute ton of punters positioned for the 200dMA reversal (and it's certainly a level to watch), however the real money is set above. So I think a few stops may be grabbed at the expense of retail positions that are too heavily leveraged with too little room for error, which will only add more weight to institutional positioning.
If SPX makes it to that 4100-4160 zone and reverses then the sell could be a dramatic one as the major players will be set and set well.
SPX daily
Now looking down under.
The Aussie 200 is also coming into an interesting zone now. One of the most heavily traded zones is sitting about 1% higher than Fridays close. Around 7300 is the level to watch - this should have plenty of insto interest at a time when things a getting a little overbought which generally doesn't end well.
The Aussie is certainly favouring bulls atm with price sitting above all dMAs and potentially reversing the downtrend (I would want to see price push beyond 7550 before claiming any reversals in trend though) However, the current run does look to be running out of steam with momentum indicators rolling over with MACD about to have a bearish cross and RSI flipping to bear mode already.
Our miners got some love recently with the whole China reopening story - which looks to be running out of puff fast. Record Covid cases and huge debt burdens coming to light for local governments which does not bode well for any big growth in the near future.
Thursday saw some extra green shoots for miners again when $38 billion was pledged by the Chinese banks for under fire property sector, however that pales in comparison to the $2 trillion debt coming to maturity over the next few years. Looks like a bit of civil unrest too due to Covid-zero policies - not an ideal growth scenario.
(20min delay)