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S&P 500 Index (SPX) - Breaking-Out »» Monthly Summary Analysis
By: Marty Armstrong | January 25, 2020

OUR ANALYTICAL OUTLOOK AS OF THE CLOSE OF Fri. Jan. 24, 2020: S&P 500 Cash Index closed today at 329547 and is trading up about 2.00% for the year from last year's closing of 323078. At the moment, this market has been rising for this market has been rising for 4 months going into January suggesting that this has been a bull market trend on the monthly time level which has been confirmed by electing all of our model's long-term Bullish Reversals from the key low. As we stand right now, this market has made a new high exceeding the previous month's high reaching thus far 333777 while it is still trading above last month's high of 324793.


ECM COMMENTARY

We have reached the target on the ECM 7 days ago, which was Sat. Jan. 18, 2020. A high forming on this precise target will warn of a correction. However, a low would imply a rally thereafter. We could see an end goal form with this turing point in 2024 producing a significant high. On the other hand, the lack of such a precise target would only imply that this market is not the main focus of net capital movement. It would perhaps signal a temporary change in trend based upon its own timing lining up with markets in its particular sector.

The last ECM target date was Sat. Jan. 18, 2020, which was about two weeks ago. Last week this market made a high at 333777 going into this target on the ECM suggesting we should pay attention to this particular market for a possible alignment and shift in trend.

RECENT ACTION

Up to now, the market remains neutral on the momentum indicator yet bullish on the short-term trend indicator while the long-term trend and cyclical strength are bullish.

During this year, we have exceeded last year's high thereby making a new historical major high to date and we have been in a bull market for a reasonable period of 11 years.

Meanwhile, our technical resistance stands at 339376 and it will require a closing above this level to signal a breakout of the upside is unfolding. Nevertheless, our technical support lies at 227103 which is still holding at this time. At this moment, the market remains between these two projections leaving it neutral on a technical basis.

Looking at our timing models, it is possible to witness a turning point come February in S&P 500 Cash Index. Therefore, remember to watch for this possible development at the time. The last cyclical event was a high established back during December 2019. Normally, this implies that the next turning point should be a low. However, to date, this market has already exceeded that previous high established at 324793. This strongly implies we are in a cycle inversion process, which tends to be rather bullish overall. Last month produced a high at 324793 but closed on the positive side and so far, we have exceeded last month's high. We now need to close above 324793 on a monthly basis to imply a further advance to the upside immediately for now. The projected resistance for this week stands at 337597 and we need to close above this level on a weekly basis to maintain any upward momentum.

Critical support still underlies this market at 284862 and a break of that level on a monthly closing basis would warn that a sustainable decline ahead becomes possible. Nevertheless, the market is trading above last month's high showing some strength. On a broader perspective, this market remains in an uptrend posture on all our indicators looking at the monthly level. We see here the trend has been moving up for the past 12 months. The previous low of 234658 made during December 2018 on the Monthly level has held and only a break of 305072 on a closing basis would warn of a technical near-term change in trend. The previous high made during December 2019 on the Monthly level at 324793 has now been exceeded in the recent rally. We have generated a buy signal so some caution is required.

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