S&P 500 Daily Perspective for Fri 14 Jul 2023

Bullish, spike trading guidelines apply

Roger

Jul 14, 2023

GDR Model Performance

This year has been challenging for the GDR Model’s style due to low confidence in the market.

GDR Model Outlook

The GDR Model is bullish.

GDR Model Position

The GDR Model has re-opened its long position. However, position size is reduced compared to earlier in the year due to deteriorating fundamentals.

S&P 500 Futures Market Profile Analysis

Near-Term Outlook: bullish, spike trading guidelines apply

Alternate Outlook: reversal of late-stage rally

Key Levels

Bullish: 4524 (Spike High), 4589 (April 2022 High), 4631 (March 2022 High)
Bearish: 4536 (Spike Base), 4522 (Y’day Excess Low), 4497 (7/12 Excess Low)

Market Narrative

Yesterday started out with a modest short-covering rally in the morning that later extended to see the market close on yet another spike up. Spike trading guidelines apply today and the near-term outlook remains bullish as long as the market stays above yesterday’s spike base (4536). However, for the market to start turning bearish it would probably need to trade and accept below yesterday’s excess low (4522) and at least seriously test the 7/12 excess low (4497).

As in yesterday’s outlook, I’ll remind you that the current rally is starting to resemble a late-stage rally with plenty of laggards piling on. Over time this can have a similar effect to short-covering rallies and weaken the market leading to a strong collapse, but as always timing is the most difficult part.

Economic Calendar

Earnings Before the Open: JPM 0.00%↑, UNH 0.00%↑
10:00am - Michigan Consumer Sentiment
Next Week: none notable