Range bound

As mentioned yesterday, it would be a day of consolidation, and price actions resulted in a Doji.

I mentioned too, that prices could see a gap up today, if history is of any guide. Futures are currently pointing to a positive start, gapping up a couple of SPX points. However, as opposed to Tuesday's moves, I think for today, we should see a very quiet range bound day.

My observation is that the SPX will be carving out a bearish rising wedge with negative divergence forming. This aligns pretty well with the bullish descending wedge in VIX.



For swing traders, it is a good time now to sell away your longs and start positioning for shorts.

Timing wise, 4th - 6th Jan could be a low, before bouncing up in the 2nd week of Jan. I will provide some estimates to the price targets nearer to the date. However, be careful that price cycle inverts from time to time. So the planned target low date may turn out to be a high date. But in all, it should be a turn.

See you folks tomorrow ! Happy trading !