SPX S/R Week of 7-18-11

SPX S/R for this week is shown.  Thursday's and Friday's low prints were trying to fill the 1307 gap but the SPX printed closes above the gap.  At 1316 to start Monday's session, the bulls have the wind at their backs, only needing one point higher to touch a 1318 handle, if so, the buying will accelerate and several handles upwards will click off quickly as the SPX tests 1321, 1323, 1326.

For the bears to flex their muscles in the Monday session, they need to drive lower to the 1307 gap again, losing the 1308 handle will be good enough, and the down side will then accelerate.  The 1307 gap is also a 50% Fibonacci retracement from the big up move that occurred from 1265 to 1353.  If the move accelerates south should the 1308 handle fail, then the 62% Fib and gap at 1298-ish will be in play.

Monday is an interesting set-up since typically the indexes should move opposite of the way they closed Opex Friday, which was a strong upward finish, thus, there should be some weakness showing Monday, even if the intial move after the opening bell is up. A move thru 1308-1317 for Monday is sideways slop.

·        1368

·        1365

·        1360 (gap fill needed)

·        1357

·        1354

·        1349

·        1347

·        1344 (gap fill needed)

·        1341

·        1337

·        1333

·        1331

·        1329

·        1326

·        1323

·        1321

·        1318

·        HOD Friday 1317.70

·        1316

·        1314

·        1312

·        LOD Friday 1307.52

·        1307 (gap fill needed)

·        1300

·        1298

·        1297 (gap fill needed)

·        1295

·        1292