XJO WEEKLY
Price structure: Remains Bullish

Last week’s “fake out “ low remains a very positive signal for a rally from this level. The retest of the 6930 has been discussed in the past weeks. Historically October remains a bullish month, with a closing price over this current fake-out bar high in the 7030 range remains a positive indication of forward price movements retesting the 7200 resistance level.

No Primary trend is evident.

Indicator: Relative Strength 14

Relative Strength has moved below the 50 level again (just) as part of the overall directional decline in price. Only further movements over the key 50 level towards the 70 level will remain a bullish signal for further gains, a continued move below this important level would signal further Bearish momentum as sentiment currently remains weak. A signal cross above the 50 is a bullish signal.

Comments last week: The small weekly range indicates the market has moved into balance during the last week of the Quarter. Strong support is indicated between the 7000 and 7070 midpoint indicated from the March impulsive range. Historically October remains a bullish month, with a closing price over this current inside range (IPd) a positive indication of forward price movements would be given.

No Primary trend is evident.

XJO DAILY
Price structure: Early Bullish signal.

Early Bullish signal remains, the observation of the market moving lower does not negate the indications of price support at key levels, although sentiment remains weak. The Fakeout low is the retest of the March ’23 low, with a swing point now in place a rally would be expected. There are plenty of overhead resistance levels the first at 7030 then 7200 and the 200-day moving average(red). The Index remains within a large consolidation area but presents some very good technical levels.

Indicator: Relative Strength 14

The Relative Strength Indicator (14) has turned higher, as the Relative Strength Indicator still remains below the 50 level, only offering a bearish indication, any reading above the key 50 level shows price momentum is positive. Traders should monitor this for a further move higher on continued strength in price movements indicating an increase of bullish momentum.

Comments last week: The small outside range last Thursday shows sellers have failed to move the market lower. However, some resistance at 7070 is evident in the Daily view. The most important support level is the FO low of 2 weeks ago, a break of this level would show sellers in control. The current breakdown below the trendline is bearish however a positive start to the week may see a retest of the trendline towards 7200.

S&P 500 WEEKLY
Price structure: Lower high.

Last week the S&P 500 set a “hammer” reversal bar and confirmed the tentative trendline and retesting the breakout point from March 2023. A further reversal rally will confirm the a, b, and c declining pattern is now complete. The key observation going forward is the current confirmed trendline holding price. Longer term a price rally will retest the 4545 level.

Indicator: Relative Strength Indicator 14

Relative Strength has again turned lower and moved below the 50 level, but to remain bullish the RSI should turn higher and remain over the 50 level with underlying price advances. The RSI rolling higher is the key observation and should be monitored for a cross over the 50 level. In the coming weeks, this consolidation below the 4545 level may re-assert a bearish RSI signal on the Relative Strength Indicator turning lower.

Comments from last week: The S&P has now set a primary down trend move with the close below the recent low point of 7 weeks ago. The current retest of the Trendline at the 4200 point support level is an important level to hold in the first week of October. In the coming weeks price failure below the 4200 may lead to further momentum selling. Look for a close over last week’s high towards 4300 for a bullish reversal.

S&P 500 DAILY
Price structure: Looking for a continuation higher.

The Daily resistance shown at 4350 points is the go-to level for the Buyers indicating a solid reversal is taking place. Last Friday’s Outside range is a very positive price reversal signal of the 200-day moving average. The reversal bar is also regarded as a large range bar and has a high statistical outcome for indicating the low is now in place.

Indicator: Relative Strength 14

Relative Strength has turned higher from the 30 level, the movement higher last Friday is helpful as the downside daily momentum slows. For further price strength in this index, the RSI move has to be higher to sideways, moving back above the key 50 level, should the RSI continue to move below the key 50 level, bearish price momentum may continue to play out in the coming weeks.

Comments from last week: The Daily resistance shown at 4350 points is the go-to level for the Buyers for a solid reversal to take place. The current price structure is a Bearish flag pattern and may first target the mid-week low that sets up the open Gap area. Further price weakness will target the 200-day moving average below the key 4200. A bearish scenario. A solid daily cross over the 4350 level remains a bullish signal for further gains.

NASDAQ DAILY
Price structure: Potential distribution top.

The Nasdaq remains within a broad top formation, the price cluster around the 14665 level suggests some support at this level. Last Friday large range movement opened as a “Gap open Buy” where the market gapped lower from the previous close and rallied higher. The index has the 15,140 level as resistance before this could be called a bullish reversal. Follow-through is required immediately to confirm buyers have control.

Indicator: Relative Strength 14

Relative Strength has moved higher over the 50-level setting a mild bullish signal as downward momentum slows. The Relative Strength increases as the underlying price movements of higher closing prices take place. No divergence is shown at this stage but should now be monitored for a further reversal turn lower indicating a loss of momentum.

Comments from last week: The potential for a Major distribution top in the Nasdaq remains. Last week’s movement below 14,665 has quickly recovered, however, the Gap higher on Friday has set a Gap open sell signal that needs to be overcome by the Buyers. A further breakdown at this level will target the 200 moving average currently at 13,600 points.

USD Spot GOLD – DAILY: Is it a Bull market? Maybe not yet.

With strong support indicated above the $1800 the key reversal bar in the form of an outside range has the potential to provide the buyers with confidence to take the price higher. The outside range has a good statistical outcome for marking reversal points both on the high points and low points. Gold remains within a downward channel with $1840 as the first resistance level to pass before a real bullish move could be identified.

Indicator: Relative Strength 14

The RSI turning higher from below the key 30 level, turning with the rising price continues to be a positive observation, consolidation in price with a breakout higher will move the indicator higher, and a Relative Strength reading over 50 indicates strong momentum. However long-term traders should continue to monitor this long-term Weekly chart for a major yearly top in progress with further declines in the long term.

Comments from last week: The bullish scenario did not develop from the higher low indicating a break over $1950.0 is possible. The OPd discussed 2 weeks ago has played out with momentum selling now targeting the lower channel line circa $1810.0. Within the last week’s momentum are 2 expanded range bars indicating strong selling. The underlying Primary trend in Gold remains down. Traders should look for support above the $1800 – $1810 level.

SILVER
Price structure: Reversal at channel Support underway

Along with other precious metals including Copper, Silver has posted a strong reversal bar within the current downtrend. The range has only closed at the 50% level of last Monday’s large range down movement. There are significant levels for the price of silver to cross before a new trend can be identified. The first resistance is $22.09 with further significant resistance at $23.00.

Relative Strength 14

Current Relative Strength has turned higher from below the 30 level, if the RSI continues lower, the bearish signal will continue, only a move to and above the 50 levels reflecting a solid change in the underlying price momentum would alert trader to a potential new trend. It should be noted the indicator is very close to moving back towards the 30 level as bullish momentum remains subdued.

Comments from last week: With the Bear Flag initially playing out to test the $22.30 level, we note Friday’s wild swing in price has closed towards the low of the day. This is a very Bearish setup as early buyers take stops, this will be confirmed with a price break below the current support level shown at $22.09. It should be noted Silver remains in a Primary downtrend.

AUSTRALIAN VOLATILITY INDEX: The equities traders compass.

The current volatility closing value has returned to the important mid-13- 11 level again following another wide-range week higher. While volatility remains at this level overall equities sentiment remains supportive for the bullish view however with the indicator pushing higher the forward pricing of PUT options is now increasing, and the underlying price volatility may turn bearish.

Lower consolidating commodities prices and bearish consolidation of equity prices are indicated when the reading moves above the 13 level.

For continued support of equities, the XVI should remain subdued below the “13” level.

The cost of 3-month forward PUT options is decreasing from recent elevated levels.

The XVI is the difference between the 3-month forward pricing of ETO Options against the current month.

As markets anticipate events, the forward-priced option volatility changes, hence as forward price changes, this “skew” in pricing is measured in this XVI.

The XVI value works as an inverse observation of the underlying market.