I1 continues down.
The longer the congestion lasted without breaking the SP futures 30-minute M/A the greater the probability of a spike. I warned yesterday afternoon that it looked like the spike was coming and we got the spike last night. It ran up to 1 point beyond the June high (adjusted for nearest futures), which was the first high point in the abc off of the June low. The trendline in the chart below intersects highs and lows backward for a decade.
I managed to trade to skip 30-point segments of the rally and exit the short at Dec DJ 10,537. I am currently flat futures for reasons that I will explain now.
While the congestion has been going since last weekend the moving averages that I use to trigger increased positions have been moving up to the point that, apart from the final 5-minute, 380-unit M/A they all have envelopes that are just below the market. Currently none of the key M/As have been broken to the downside. Hence I'm only 10% SDS.
The first is the SPX 15-minute, 54-unit EMA which has a trigger level of 1117.30. This is the cash SPX.
Finally, the critical support is the 5-minute, 380-unit EMA. This has been moving up as well but the break will only come when 10,415 DJI is broken. This will be moving up during the cash sessions.
I'm going to expand this commentary once all of the data is available for the Daily Technical Composite and if the results are significant. As of last night we were on a -10 minor sell signal which, nonetheless, has tended to stop stock market movements in their tracks.