Good Morning Traders!
SPs rallied to new all time highs over the holiday session. There is no overhead resistance and the chart below shows a potential measured move objective. The persistently high put call ratio suggests that there is no speculative excess and sentiment readings support continuation of this rally. The Summation Tick has only just turned back up as well. Nothing suggests overbought in the market conditions. The Russell is just breaking its downtrending channel line. The intermediate term correction last around 10 weeks. The weekly charts support a better reaction to the upside now. 1898.50 was the previous high. For Tuesday, this is going to be the main reference point to the downside. The market will most likely have a large opening gap and can trend in either direction off this gap.
Buy divergences in the Eurocurrency are corrective in nature. 136.69 was the previous swing low in March to use as a reference point. The Canadian Dollar has taken over as the short term relative strength leader. The AD has a textbook three bar triangle breakout pattern going into Tuesday’s session.
Wheat remains on an extended run (persistency of trend). Not every market ends up with this type of run under these conditions, but this has been a good example. In the meantime, Beans are trading back below their previous 20 day high. A close back below this level can lead to the middle of the prior trading range.
Have a great trading day!