SPX Monitoring Purposes: Sold 11/29/23 at 4550.58 = gain 10.52%; Long SPX 10/27/23 at 4117.37. Gain Since 12/20/22: 26.8%. Monitoring Purposes GOLD: Long GDX on 10/9/20 at 40.78.
The bottom window above is the VIX; readings below 17 lean bullish, as most tops in the market start to form when the VIX is above 17 (current VIX reading is 13.08). However, a rising VIX, along with a rising SPY is a bearish sign, and both the VIX and SPY have been rising over the last several days. Last Friday, the SPY closed at a new short-term high and volume expanded to the highest levels going back over a week. Most high volume highs are tested, and, if tested on lighter volume, would add to the short-term bearish picture. A gap formed near the 440 range and would be a possible downside target. We sold our long SPX on the close of 11/29/23 at 4550.58, a gain of 10.52%. Long from SPX 10/27/23 at 4117.37.
The bottom window is the SPY, and the next higher window is the TLT/VVIX ratio. In mid-October, the SPY was making lower lows and the TLT/VVIX ratio was making higher lows and a bullish divergence (noted in light blue): October 27 marked the low. Currently, we have the SPY hitting a higher highs and the TLT/VVIX ratio making lower highs and a bearish divergence. This negative divergence can last several days, if not a week or two. There is evidence that, over the next couple of weeks, a pullback in the SPX (SPY) may materialize. We pointed out that Friday’s volume on the SPY was relatively high, and most high volume highs are tested, which could be a short-term target for the next high. A large gap formed on the SPY near the 440 range, and most large gaps get filled at some point. The 440 on the SPY represent a 38.2% retracement and a possible downside target. The bigger trend is up and the shorter term trend is sideways to down. Staying neutral for now.
Tim Ord,
Editor
www.ord-oracle.com. Book release “The Secret Science of Price and Volume” by Timothy Ord, buy at www.Amazon.com.
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