S&P 500 - Fib 1.786 Reached - where now?
Hello Traders and Analysts,
Breakdown:
1. Note
2. Contents
3. Research breakdown
4. Education recap
5. Information on Lupa.
A Note before reading - this is a forecast analysis - based upon our trading strategy. This is tagged neutral, due to purchasing further increments upon imbalances. Overall, assessing the short idea [but remaining patient].
Please do not take this as face value and conduct the relevant investment strategy to successfully trade the probabilities.
Master Key for zones
See the original below:
This will provide a good explanation with multiple charts and views which give enough evidence to create the possibility of the targets reaching the Fibonacci over extended pattern.
Analysis for 2021 outlook.
Monthly Imbalances
Currently price has reached the 1.786 extension in a very quick fashion. The imbalance here on the monthly has not established itself for a sell, however a reactive level upon the monthly is the 1.786 Fibonacci Extension.
Here is a potential imbalance to add longs [Monthly]
Price has moved towards the 1.618 and 1.786, this is now a critical zone to highlight.
Price has now created the interesting inefficient pricing leaving a long imbalance short effect, this will require patience while the sequence is completed for the Selling imbalance to take place. [currently this is not actionable for sell probabilities] However, smaller timeframes of course opportunities will be presented.
Take note of an impulsive wick and instantly rejecting, this can be the creation of the imbalance all time high.
Here is the weekly imbalances which have provided the roadmap for trading.
The clear path of the Fibonacci sequence - with the price offering reaction levels upon the "0" Fibonacci, again at the 1.272 (although not used on the chart) the pivot point to create a higher low between 3700-3800.
Daily Imbalances
The daily chart offers the overall structure from the Extension targets, providing high probabilities for bullish pricing from the price reverting to first the ("1") Fibonacci which is a double top format.
From here the price had an opportunity to look for higher highs to be created.
Using the the Ray extension to infinite* - the reactive levels showed imbalances where price will form a reversion point being the ray.
This will dictate "bounces" and offer new additions for longs.
*infinite being, using the monthly chart to show a number outside the chart axis.
Daily VIX or Volatility Index overlay
With a Risk-on approach, the SPX or SP500 has created multiple opportunities to continue with price rising towards the imbalance zones.
VIX Chart Stand Alone
This is based on the weekly chart, where the VIX has been trading in a bearish channel.
Now with the inverse correlation here printing lower lows and lower highs. The SPX is printing the opposite opportunities.
The monthly imbalance is still presenting a high probability of inverse moves whereby the Bullish Risk-off scenario can present itself. (Only where the price creates higher lows and engulfs from 12-14XX.
Comparisons using;
RINF - Inflation Expectations ETF
TLT - iShares 20 Year Treasury Bond ETF
Based on the weekly as it shows further data and to distinguish patterns upon trading weeks. This is the best format to apply imbalances.
Notice the inverse correlation with the Growth of the inflation ETF climbing to the double top imbalance which dates back to January 2019.
The 20year bond yields are stuck in a zone of there own at this present moment distinguishing a noticeable pattern - heading towards an imbalance. [See below Figure 2] for a closer display of the probability where the Vix can catch up to the 20 year yields.
[Figure 2]
The VIX displays a depressed low - "Risk on approach" while witnessing the monthly imbalance to be tested.
The run away of the yields however in the 20year in the past cycle rereferring to 2020 - highlights the yields to turn bullish from the imbalance in a flustered move to create a new high. The VIX is left behind but the trigger delay is then caught up and surpassed. Can this cycle repeat?
Refer to the Chart below for the Aussie Dollar Vs US Dollar.
Using the US Dollar strength to your advantage
This explains it all in inverse correlated pair.
Current scenario of the DXY vs SPX
Black = DXY
See the split screen of the outcome of the weekly USD CAD [right], where price has rejected the weekly imbalance and still inside the monthly imbalance however, but the wick on the weekly has successfully filled in the wick creating a buying imbalance upon the shift of probability.
The DXY has also noted a triple bottom where the monthly shows a strong probability of the negative correlation of the SPX and EUR USD where the imbalances will offer opportunities in buying imbalances, short imbalances respectively.
Here are the weekly timeframes to support:
Removed
Bearish Scenario, Bullish Entry scenario.
FED Funds
Commodities
Do you enjoy the setups?
*Professional analyst with 5+ years experience in the capital markets
*Focus on technical output not fundamentals
*Position and swing trades
*Provide updates where necessary - with new updated ideas tracking the progress.
If you like the idea, please leave a like or comment.
To all the followers, thank you for your continued support.
Thanks,
LVPA MMXXI
Breakdown:
1. Note
2. Contents
3. Research breakdown
4. Education recap
5. Information on Lupa.
A Note before reading - this is a forecast analysis - based upon our trading strategy. This is tagged neutral, due to purchasing further increments upon imbalances. Overall, assessing the short idea [but remaining patient].
Please do not take this as face value and conduct the relevant investment strategy to successfully trade the probabilities.
Master Key for zones
- Red = Three Month
- Blue = Monthly
- Purple = weekly
- Scarlet [Red] - Four day
- Orange = Daily
- Green = 8 Hour
- Grey = 4hour
- Pink = 1 hour
See the original below:
This will provide a good explanation with multiple charts and views which give enough evidence to create the possibility of the targets reaching the Fibonacci over extended pattern.
Analysis for 2021 outlook.
Monthly Imbalances
Currently price has reached the 1.786 extension in a very quick fashion. The imbalance here on the monthly has not established itself for a sell, however a reactive level upon the monthly is the 1.786 Fibonacci Extension.
Here is a potential imbalance to add longs [Monthly]
Price has moved towards the 1.618 and 1.786, this is now a critical zone to highlight.
Price has now created the interesting inefficient pricing leaving a long imbalance short effect, this will require patience while the sequence is completed for the Selling imbalance to take place. [currently this is not actionable for sell probabilities] However, smaller timeframes of course opportunities will be presented.
Take note of an impulsive wick and instantly rejecting, this can be the creation of the imbalance all time high.
Here is the weekly imbalances which have provided the roadmap for trading.
The clear path of the Fibonacci sequence - with the price offering reaction levels upon the "0" Fibonacci, again at the 1.272 (although not used on the chart) the pivot point to create a higher low between 3700-3800.
Daily Imbalances
The daily chart offers the overall structure from the Extension targets, providing high probabilities for bullish pricing from the price reverting to first the ("1") Fibonacci which is a double top format.
From here the price had an opportunity to look for higher highs to be created.
Using the the Ray extension to infinite* - the reactive levels showed imbalances where price will form a reversion point being the ray.
This will dictate "bounces" and offer new additions for longs.
*infinite being, using the monthly chart to show a number outside the chart axis.
Daily VIX or Volatility Index overlay
With a Risk-on approach, the SPX or SP500 has created multiple opportunities to continue with price rising towards the imbalance zones.
VIX Chart Stand Alone
This is based on the weekly chart, where the VIX has been trading in a bearish channel.
Now with the inverse correlation here printing lower lows and lower highs. The SPX is printing the opposite opportunities.
The monthly imbalance is still presenting a high probability of inverse moves whereby the Bullish Risk-off scenario can present itself. (Only where the price creates higher lows and engulfs from 12-14XX.
Comparisons using;
RINF - Inflation Expectations ETF
TLT - iShares 20 Year Treasury Bond ETF
Based on the weekly as it shows further data and to distinguish patterns upon trading weeks. This is the best format to apply imbalances.
Notice the inverse correlation with the Growth of the inflation ETF climbing to the double top imbalance which dates back to January 2019.
The 20year bond yields are stuck in a zone of there own at this present moment distinguishing a noticeable pattern - heading towards an imbalance. [See below Figure 2] for a closer display of the probability where the Vix can catch up to the 20 year yields.
[Figure 2]
The VIX displays a depressed low - "Risk on approach" while witnessing the monthly imbalance to be tested.
The run away of the yields however in the 20year in the past cycle rereferring to 2020 - highlights the yields to turn bullish from the imbalance in a flustered move to create a new high. The VIX is left behind but the trigger delay is then caught up and surpassed. Can this cycle repeat?
Refer to the Chart below for the Aussie Dollar Vs US Dollar.
Using the US Dollar strength to your advantage
This explains it all in inverse correlated pair.
Current scenario of the DXY vs SPX
Black = DXY
See the split screen of the outcome of the weekly USD CAD [right], where price has rejected the weekly imbalance and still inside the monthly imbalance however, but the wick on the weekly has successfully filled in the wick creating a buying imbalance upon the shift of probability.
The DXY has also noted a triple bottom where the monthly shows a strong probability of the negative correlation of the SPX and EUR USD where the imbalances will offer opportunities in buying imbalances, short imbalances respectively.
Here are the weekly timeframes to support:
Removed
Bearish Scenario, Bullish Entry scenario.
FED Funds
Commodities
Do you enjoy the setups?
*Professional analyst with 5+ years experience in the capital markets
*Focus on technical output not fundamentals
*Position and swing trades
*Provide updates where necessary - with new updated ideas tracking the progress.
If you like the idea, please leave a like or comment.
To all the followers, thank you for your continued support.
Thanks,
LVPA MMXXI
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.