$SPX - Bounce Weakens Ahead of CPI

SmartReversals
01-15

$.SPX(.SPX)$ - Bounce Weakens Ahead of CPI

As anticipated yesterday, the $5,880 zone was key to determining the bounce's strength. Today's high of $5,872 fell short of that level. The indecisive candle opens up any scenario ahead of the CPI report.

Today's high coincided with the 10DMA, a line to conquer tomorrow to consider a bounce (The oscillator suggests the bounce thesis is still live). On the other hand a loss of the 100DMA would trigger lower lows.

What will be breached first? 10DMA or 100DMA?

$Invesco QQQ(QQQ)$ $NASDAQ 100(NDX)$ $iShares Russell 2000 ETF(IWM)$

Image

JPM's analysis indicates the potential reactions of the SPX in relation to the CPI report on Wednesday.

Should the core CPI increase fall between 0.17% and 0.23%, the SPX is likely to rise by approximately 0.25% to 1%. Conversely, if the CPI reading is significantly lower than anticipated, ranging from a 0.10% to 0.17% rise, the SPY could see an increase of 1% to 1.5%.

However, if the core CPI falls between 0.23% and 0.30%, this scenario may result in a loss for the SPX of around 0.75% to 1.25%.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment
6