Coming into this week, we’re continuing to focus on the upcoming events in the overall market on Friday, Sept. 17: quad-witching, options expiration date, and S&P indexes rebalances. Since the SPX roll event began last week, the market has dropped lower. We’ve seen prices start to chop sideways on Thursday as we approach Friday’s events…
To gauge direction, we’re focusing on two key indicators, the 50-day simple moving average (SMA) and the Ichimoku Cloud. Every pullback this year, the S&P 500 (ES) has been breaking to the 50 SMA, and if it doesn’t stop there, to the daily Ichimoku Cloud top.
When the ES retests the 50 SMA, the market is met with strong support that boosts the market higher rather than dropping to the Ichimoku Cloud.
The ES held the 50 SMA on Thursday, and if it continues to hold that level and boost through the $4,480 range we could see a push back up to all-time highs at $4,550.
Hold the 50 SMA, buy the dip. If we don’t hold the 50 SMA, it’s an even better dip to buy at the Daily Ichimoku Cloud.
Watch the video above to see how the YM and NQ have acted and how they could push or pull the ES and the overall market. We’re keeping a close watch on GOOGL, MRNA, NFLX, and AMD for potential dip buy opportunities.
Stay Focused!