SPX Rallies At Multi-Year Support, Can Bulls Finally Get Going? October 4th Plan
After the ugliest September since 2002 for ES, as I’ve written here for weeks October is seasonally better and it started off with a bang with the biggest green day in a month. Its no coincidence where this rally started from. As readers know, I’ve been looking for 3575 for several weeks and spoke about it as the area I was looking to go long. This is not only the 200 Week MA zone, but also support of a core rising channel from the COVID bear market lows.
In my last newsletter Thursday I wrote: “My general lean is we test that 3570s area then try a long”, and this couldn’t of played out better, setting a low at 3571 overnight and rallying 125+ points. I also indicated I would add to this at 3650 for a possible multi-day run and this followed through nicely.
We have a situation where ES held critical support, recovered the June lows, and seasonality is bullish - this is a highly bullish combo. At the same time though, we do remain in a bear market where every rally has sold. In today’s newsletter, I’ll be talking what my targets are for this relief leg, some risks I see here, and what the triggers to resume downside are.