E-Mini S&P 500 240 Minute Chart

Today’s impressive, impulsive continuation of the bull above last week’s 2924 high obviously reinforces a bullish count, but its most important by-product is the definition of Thur’s 2889 low as the latest smaller-degree corrective low the market is now minimally required to fail below to confirm a bearish divergence in momentum and stem the rally.  In this regard this 2889 level becomes our new short-term risk parameter from which a still-advised bullish policy and exposure can be objectively rebased and managed by shorter-term traders with tighter risk profiles.

This tight but objective risk parameter may come in handy given the market’s close proximity to 21Sep18’s 2947 all-time high shown in the daily log chart below.  If there’s a time and place for this market to fail, it’s here and now, and we will gauge such a failure by a relapse below 2889 specifically.  Until and unless such sub-2889 weakness is shown, the trend remains up on all practical scales and should not surprise by its continuance or acceleration to new all-time highs above 2947.

From a longer-term perspective commensurately larger-degree weakness below 25-Mar’s 2789 larger-degree corrective low and key risk parameter remains required to break the major uptrend from Dec’s 2317 low and warrant paring or neutralizing long-term exposure.


E-Mini S&P 500 Daily Chart


E-Mini S&P 500 Weekly Chart

e weekly log chart above shows the market’s current position and condition that seems poised for new all-time highs.  But we would remind traders of a similar condition in Nov’15 relative to May’15’s then-all-time high from which the market imploded.  We won’t worry about a similar implosion this time until and unless the market fails below at least our longer-term risk parameter at 2789.  Until then and against the backdrop of the secular bull market shown in the monthly log chart below, traders are advised to maintain a full and aggressive bullish policy ahead of expectations of new all-time highs and level indeterminately higher beyond last year’s 2947 high.  A failure below 2889 is minimally required to threaten this call and warrant defensive steps commensurate with one’s personal risk profile.

E-Mini S&P 500 Monthly Chart


RJO Market Insights

RJO Market Insights specializes in forward-thinking analysis, focused on potential market-moving events and dominant factors driving price discovery. Detailed fundamental and technical coverage across multiple commodity sectors is combined with objectively-constructed trade recommendations to provide an industry-leading product for R.J. O’Brien’s Institutional clients, commercial hedgers, introducing brokers and individual investors free of charge. Content is distributed in both text and audio formats, with specialized service offerings provided by account type.
For more information on RJO Market Insights, contact your broker or RJO representative.