We are in a strong momentum, but hardly it’ll keep going up without a pullback, and the 21 is there to support the price, along with the 4,322.
The index did fill its previous gap at 4,322 as we expected, since we lost the red line at 4,366, and we did a sharper pullback seen in the as well.
Yes, the SPX hit our mid-term target at the black line around 4,289, and it did what seems to be a false breakdown, which happens when the price closes under the previous support, but the next day it quickly recovers, and closes above the support line again.
This situation is very frustrating for the bears, as it shows a lot of weakness on their part. The index couldn’t even retest its purple trendline yet (last time we touched it was in March).
As usual, all we can assume is that the index will continue its momentum. However, if the index loses the 4,289 again then I’ll be more convinced of a sharper pullback to its trendline, or to the previous support at 4,167. But this is a big “if”. For now, let’s not assume things, and just react to the facts.
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