By: Jeff Cooper
Hit and Run Morning Stock Report: November 23nd, 2022
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Where Is the Market Headed Into the December Fed Meeting?
On the Square of 9 Wheel of Time & Price, 407/408 (4075) is 180 degrees straight across and opposite October 13th, the low of the year.
Time points to price, price points to time.
As legendary trader W D Gann wrote, “When time and price square-out expect a change in trend.”
I say, all important highs and lows are square-outs, but not all square-outs are important highs and lows.
It is the behavior when and where time and price balance out or square-out that tells the tale of the tape:
Speculation is observation, pure and experiential; thinking isn’t necessary and often just gets us into trouble.
In addition to the above potential square-out at 4075, there is another possible square out at at 408/409 (4085) which is square January 4th --- the day of the SPX all-time high.
So we have synchronous vibrations in the same region: 4075-4085.
The Rule of Multiples applies increasing the odds that:
1) The SPX will likely be magnetized to this aforesaid region.
2) That a drive to this area should be rejected.
The Elliott Wave structure for 2022 looks like October 13th marked an Intermediate Wave 1 low.
If the SPX should strike the 4075-4085 region, it may be completing Intermediate Wave 2…a corrective/countertrend leg in the Bear.
Interestingly, 412/413 (4125) is square Dec 13-14, the date of the next Fed meeting.
As you can see there is a convergence several technical and price factors in the 4075-4086 region while 4125 ties to the next Fed meeting.
Is it possible we get a Spike & Reversal on Fed Day, Dec 14?
The bottom line is there is strong synchronicity between 4075-4085 and the 200 day moving average and 4125 which ties to the upper rail of a rising trend channel since the October 13th Key Reversal Day low.
It’s a long time between here and December 13-14?
Is it possible the index drops to tag the lower rail of the rising channel prior to a leap to 4125 when the Fed talks?
In sum, trade below 3875 that sticks reduces the odds of a pop to the 4100 region.
Yesterday’s Hit and Run Report showed the following daily SPX suggesting a rally. We got it. Follow through projects to 4075-4085 with a shot at 4125.