XJO WEEKLY
Price structure: Strong advance.

A strong range, closing at the high was presented last week, some follow-through should be expected during this trading week. With the current Weekly closing price remaining within the larger range between support at 6930 and resistance of 7370, the index remains within a downward movement. A further weekly close over 7200 is required to offer a bullish view. Currently, the Index has the potential to retest the 7370 level on any continuation of the current move.

Indicator: Relative Strength 14

Relative Strength has moved above the 50 level again as part of the overall directional move higher in price. With the indicator turning sideways, 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.

Comments last week: Closing towards the high of the week, suggests some follow-through should occur. The importance of the Index, although heavily weighted in 5-8 stocks is the sentiment reading on the strength of the buyers. The current small range for the Week indicates the market remains in balance.

XJO DAILY
Price structure: Breaking the 200-day moving average

The XJO200 has again reclaimed the 200-day moving average, following the break above the 7090 level, significant Daily resistance levels remain, however the outside range set last Friday should follow through to the 7290 level. The Daily price movement has now entered into a UP Trend since the October low.

Indicator: Relative Strength 14

The Relative Strength Indicator (14) has turned higher into the close on Friday, as the Relative Strength Indicator continues to move above the 50 levels, offering a bullish indication, any reading above the key 50 level shows price momentum is positive within the look-back period of 14 days. Traders should monitor this for a further move higher on continued strength in price movements indicating an increase of bullish momentum from the recent divergence signal.

Comments last week: The a, b, c movement referred to last week has followed through higher, but found resistance at the 7090 level, historically a very important level of support and resistance. Last Thursday showed a very high volume day, this is a bullish indicator with the market closing towards the high. Expect some further movement higher towards the 200-day average value around 7150.

S&P 500 WEEKLY
Price structure: 5 wave structure breakout continues

The index closing towards the highs of Q3 2023 and moving towards retesting the 2022 highs remains a very positive signal for a push to an all-time high. The 4-week momentum movement remains at risk of now being an “overextended move”, the overall market is at a level where profit-taking may see a retracement back to the 4545 level and lower. In the coming weeks, a further close over the 4600 level would be very bullish for a retest of the 4818 level and a further Christmas rally.

Indicator: Relative Strength Indicator 14

Relative Strength has again turned higher and moved above the 50 level, but to remain bullish the RSI should remain over the 50 level with any underlying price advances. In the coming weeks, this consolidation below the 4545 level may re-assert a bearish RSI signal as the Relative Strength Indicator turns lower.

Comments from last week: Last the S&P posted a strong advance to again close over the first significant resistance level of 4545. This level is a significant transition point to cross to ultimately suggest the index will move ahead and continue to make new highs.

SPX DAILY
Price structure: A break of resistance.

The closing price from last Friday indicates a breakout from the small “Diamond” pattern with the price closing at the 4606 level, this short-term view should be monitored for a reversal. A close below the 4600 level would be the first indication of profit-taking. Traders can monitor this chart for reversal patterns in the form of an outside range down close (OPd) or a basic Pivot reversal pattern. The move from the October low remains “corrective”. Further higher closes are required for a true breakout signal to occur.

Indicator: Relative Strength Indicator 14

The Relative Strength Indicator has moved into the 70 level indicating very strong momentum. Although not a signal of brought, the second and third movement into this level is often seen as a level to take profits.

Comments from last week: With a break to the topside of the current 8-day trading range, strong resistance remains at 4607 points should the Index continue higher. Current price movement remains “extended” and traders should remain vigilant the Index has a history of closing gaps, and in the coming week price weakness may retest back towards the 4400 level.

NASDAQ DAILY
Price structure: Recovering rally.

Many unfilled Gaps remain in the current Nasdaq price advance from the October low. The retest of the “Gap” area followed with a strong close last Friday the late November high is being challenged, a close over the 16,100 level would be a very Bullish signal from this clear breakout. A further close lower into the “Gap” would signal a bearish breakdown with the potential to move towards the 200 SMA.

Indicator: Relative Strength 14

Relative Strength is declining from the 70 range, setting a loss of upward momentum as price weakness comes into play. The overall Relative Strength is declining as the underlying price movements of the Index move to set closing price highs. The RSI should now be monitored for a further turn lower indicating a change to negative momentum.

Comments from last week: As with the other Indices within the Nasdaq chart it remains the potential of setting an island top in the coming days. Last Wednesday’s Fake Out (FO) of the previous high is a strong indication buyers are becoming exhausted. The requirement is for a “GAP” down, the outcome being Buyers are left at the Island top, often forcing a sharp reversal. For the Bullish view to develop, a continued closing price over this important 15932 level is required, as the index declined below this level last week, a further close below 15932 would signal a bearish reversal underway.

USD Spot GOLD – DAILY: Bull Trap at the 4th High

Gold has again tested the $2072 level with a strong rally, that was immediately rejected (OPd) to force the closing price below the $2049 support /resistance level. The current short-term trendline has been broken with the current close below the key $2,000 level. The potential remains for a retest lower below the key $1982.0 level to $1960.0 The underlying Primary trend is yet to be established.

Indicator: Relative Strength 14

The RSI turned lower from below the key 70 level, turning with the falling price, recent consolidation in price with a breakout lower will move the indicator lower, and a Relative Strength reading below 50 indicates bearish momentum. Long-term traders should continue to monitor this long-term Daily chart for a 4 th major yearly top in progress at $2072.0 with further declines in the long term.

Comments from last week: With the bearish Pivot point reversal now failing, Gold has moved higher to retest the all-time high at the $2072.0 level. Last Friday set a strong continuation bar with the close above this important level and the potential to follow through higher. However long-term traders should continue to monitor this long-term Daily chart for a 4 th major yearly top in progress at $2072.0 with further declines in the long term.

SILVER
Price structure: Head and Shoulder neckline retest.

Strong rejection (OPd) from below the $26.20 level to see a 10% price decline towards the Head and Shoulder neckline at $23.0. Silver remains within a broad trading range between $22.09 support and $26.20 resistance with no identifiable primary trend. Last Friday’s “impulsive range” is a further bearish signal with the short-term potential for a retest towards $22.09.

Relative Strength 14

Current Relative Strength has turned lower from above the 70 level to move below the 50 level, indicating momentum has turned negative, if the RSI continues lower, the bullish signal will have failed, only a continued movement above the 50 level reflecting a solid change in the underlying price momentum would alert to a potential new trend and breakout.

Comments from last week: Silver has entered a Primary move higher with the break of price above the $24.60 level with an impulsive price move. The current price movement from the continuation pennant is very positive for further gains. Overall Silver remains within a large consolidation zone between support at $22.09 and resistance from April 2022 and 2023 shown at $26.20.

AUSTRALIAN VOLATILITY INDEX: The equities traders compass.

The current volatility closing value has moved below the 13 levels closing lower the XVI is now within the “complacent” level. This is the lowest level for several years and may lead to higher volatility (declining price) on a rise in the indicator.

While volatility remains at this level overall equities sentiment remains supportive for the BULLISH view, with the indicator pushing lower the forward pricing of PUT options is now decreasing, and the underlying price movements may remain bullish.

Higher consolidating commodities prices and bullish consolidation of equity prices are indicated when the reading moves below 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.