Shocked at the S&P 500 breakout? Don't be.

Just a reminder of my opinion of where we are on the S&P 500

Fib targets were in the 1260-1265 range and the 1295-1300 range.  I mentioned that 1300 as a psychological number could be the top, however, the 1285ish level is where wave 1 would equal wave 5.  Therefore judging at where we were at the close of December, the S&P was quite far from the price / time target of 1285 on January 5th.   Well today's pop does bring us closer to the projected level.  Please remember this is just my opinion on the markets, using technical analysis.

There are situations occurring in the FOREX market also that confirm the above analysis. For example, USD bounced as well off a level indicating that it could now start to rally strongly.  This is strange as it runs counter to what happened in the stock markets as the USD and S&P 500 have been inversely correlated lately.


Current S&P 500 move on a 30 min chart.

The current move faded a little in the afternoon, but that would be expected from such a large move in the morning.  January 7th friday could be telling, if you see a strong negative move, expect the week that follows to continue down.


I have mentioned previously as well, that January options expiration week could be extremely volatile as bulls and bears fight for direction.