12.29.2021

Some observations about the INDEX:

1- The 61.8% FIBO line has been FORMIDABLE SUPPORT. Recent double-bottom held and we saw 700 bps move higher.

2- The BIG SPIKE in 2020 (COVID) was 900 bps and it reversed very fast. FED actions were swift, they included extending SWAP LINES to major Central Banks to soften the USD shortage.

3- There is a SUPPORT line close, that is 70 bass points lower, there should be some congestion at those levels.

4- The dollar rally seems to have been corrective, but we cannot determine that at this juncture.

5- The 38.2% FIBO has offered RESISTANCE and a DOUBLE TOP has formed (more visible on the daily)

We isolate the last leg and look at the DAILY CHART

1- There is SHORT TERM support that has been compromised, we could see a test of the 38.2% FIBO

2- On the DAILY chart, the move LOWER would be CORRECTIVE. A trend break only would happen if we make new lows (sub 1112.94)

3- The 38.2% FIBO is 125 bps away (lower) and it seems like a reasonable short term target.

HOURLY CHART

1- The trend since JUNE has been pretty evident. HIGHER.

2- The trend line is about 65 bps away, a test and a break would extend the corrective move lower.

15-MINUTE CHART

1- The RED BOX is the RESISTANCE area, we know that it is a FIBO on the WEEKLY chart.

2- The GREEN SUPPORT line has held the short term bottom of the range, it was breached, we need to see follow through for it not to be a FALSE BREAK.

3- There is a MINOR TREND LOWER ( we will look at a micro chart to find levels of engagement)

5-MINUTE CHART

1- If we see NEW LOWS we will get confirmation that this trend will continue and reach the FIBO market on the DAILY (125 bps lower)

THESIS:

The CORRECTIVE MOVE lower should continue, it gets NEGATED if the INDEX makes a new SHORT TERM HIGH, above 1193.00