Well that was an unusual day yesterday, with the tape buffeted on and off all day by news. Statistically July 1st is the most consistently bullish day of the year, but the bears dominated the day, but without managing to negate the double bottom setup and conceding a strong close to the bulls.
The constant news bombs reminded me powerfully of 2011 when the news was also mostly about the same mess in Greece of course. If an agreement can be put together this time as well to keep the Greeks in the Euro for the moment, then perhaps we can look forward to the same again in two or three years. Who can say?
The main thing that the bears failed to manage yesterday was to test the daily lower band at 2060, and that being the case, there is now a possible target at a retest of the daily middle band at 2096. With the double bottom target at 2092/3, and open 60min and 15min buy signals, that means there is a credible setup here for a big rally to those levels today or Monday, with the caveat that the stats for today are almost as bearish as yesterday's stats were bullish. SPX daily chart:
The important support level to watch today is rising support from the lows at 2071. A break below would weaken the rally case here and open up a test of the daily lower band, and a test of that would resume the daily lower band ride. Above there is declining resistance from the highs in the 2081/2 area, and a break over that would open up the double bottom target at 2092/3 and the daily middle band at 2096. SPX 15min chart:
Hard to say what volume will be like today going into the holiday weekend, and as ever this week, watch out for news bombs. Everyone have a great weekend. :-)
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