24/10 Indices, page-9

Big week in markets last week and the weekend turned out to be even bigger for me with Cox Plate getting a little out of hand, hence why there was no TA yesterday...

Volatility dominated markets and what looked to be a negative week turned out to be the best week since June for SPX.

One of the big catalysts for the week was the sell off on the USD with DXY getting whipsawed Friday to close in the red after a very short fakeout rally.
I mentioned last week a couple of key levels to watch were 111.90 and 113.25.

111.90 was a bit of a magnet all week and price ended up closing below this level at 111.70.
113.25 looked like it was always going to get tested and once tested did draw out plenty of sellers as price spent almost no time at all trading above this level.

If DXY can stay below 111.90 level this week then markets may get some love.
A pull back to 108/109 level is expected if price cannot push back above that key level
106 would be an extreme low and without any real catalyst would expect to see strong buying at this level if it were to be tested.

For those that are still bullish on DXY in ST I would watch current range as it is potentially setting up as a bull flag and the current retrace may just be a small pause before the new leg up - potentially targeting 114.68 then 116.

As I write this DXY is sitting right at bottom of range at 111.35

DXY daily


SPX had quite the week and ultimately closed almost 5% up!
Tuesday saw a breakout of downtrend since Sept.
After the breakout we saw an extended backtest which remained till early in Fridays US session, where there was a strong rally to close out the week.

Couple of things to consider for the week ahead.
Firstly Fed is currently in blackout period.
As they say, no news is good news and with the Fed rhetoric of late this may just be the case.

Secondly, Apple and Amazon earnings is coming Thursday so we may see some chop leading up to that without actually getting any clear direction until then.

Also watch UK PMI today also as it could have an effect on Euro trading session.

I watch ES but my chart for that is a little messy to read without detailed explanation so will include SPX below

FWIW next level to watch is ES 3830 but if bulls get their way then 3953 is very much on the cards with an extreme high of 4111 - but I'd expect Apple and Amazon would need to play ball for that to happen...

SPX daily


Flipping over to the weekly and that all important 200MA managed to show strong support as price has recaptured bullish range above - was the week prior the capitulation we've been waiting for?

I mentioned a few weeks ago this MA is a tough one to break and it's put up a pretty good fight when challenged.

3605 is current level and still an important price to watch

SPX weekly


Natural Gas is one market I've mentioned worth keeping an eye on and last week I said it looked as though it was ready to break and break it did with NG selling off over 23% for the week!

It's now coming into some key levels of support and I do think it's been treated a little harshly so may provide some buying opportunities down here but with volatility at extremes I wouldn't be going heavy if using leverage and I would keep stops wide.

3.95 - 4.80 looks to be a good accumulation range coming into NH winter and potential for Russia to throw a real curveball with Euro threatening to cap.

Regardless if trading or not this market is good to watch as energy has put heavy pressure on most markets this year.
The current sell off has strengthened the bulls case as any extended periods of lower prices will most certainly help bring inflation down.

Natural Gas daily (key levels marked)


There's a bit of chat about a decent rally for the next fortnight and plenty of charts and news events all seem to line up with this opinion.
Obviously Tech megacaps will have a big effect on direction but perhaps just a few greenshoots in markets finally?
It's certainly overdue...

As always DYOR and good luck whichever way you trade...