SPX Monitoring Purposes: Long SPX 6/21/23 at 4365.69; sold 7/21/23 4536.34=gain 3.91%.
Long SPX on 2/6/23 at 4110.98: Sold 6/16/23 at 4409.59 = gain of 7.26%. Gain since 12/20/22=17.68%.
Monitoring Purposes GOLD: Long GDX on 10/9/20 at 40.78.
Our view remains the same; we said yesterday, “The middle window is the monthly SPX. The SPX is running into the highs of February, March, and April 2022 near the 4600 range, which is a natural resistance area and may stall the market. Seasonality-wise the market is entering into the weakest quarter of the year starting now and turning to October. Our view is that a trading range may develop with a resistance near 4600 SPX and support area near 4200. This potential trading range could last into October and develop a ‘Right Shoulder’ of a head-and-shoulders bottom, where the ‘Left Shoulder’ developed from February to April 2022. The ‘Head’ of this potential head-and -shoulders bottom lies at the October 2022 low. SPX was up five months in a row and August is one of the weakest months of the year and that combination could lead to a pull back. VIX remains relative low and still leans bullish. Don’t see a good setup yet.”
The second window down from the top is the SPX/TLT ratio. Markets always try to keep in balance and, when out of balance, it will go back to the norm. When the RSI for the SPX/TLT ratio trades above 70 (current reading is 82.10) the SPX was near a short-term high. We circled in red on the SPX chart when the RSI of the SPX/TLT ratio was above 70. With a current RSI reading of 82.10 on the SPX/TLT ratio, the upside for SPX would seem limited. We have said that there is a possibility that the Bearish Engulfing pattern high of July 27 (4607.07) may be tested before a pullback begins, and that possibility is still present.
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