mcm daily market update 7.Nov.22
Main trend: neutral
ST trend: up
Things were looking pretty grim for bulls last week after a hawkish FED broke the up trend, price slicing below all MLs and some important TLs. On Thursday bulls managed to defend the 3700 SPX lvl and chopped in a 50 point range. Friday saw a surprising gap up, which was sold twice, but bulls managed to come back each time. Price rejected on Friday at macro-ML, but bulls managed to defend ML, albeit sloppy. So while bears had every reason to break lower, they couldn't, so it looks like they dropped the ball, bulls signaling that they are ready to take the lead again.
Sunday saw a gap down, but also that was bought and bulls managed to defend ML. Now bulls are trying to breakout from macro-ML too. These developments show that bulls are attempting to win back the ST trend.
In terms of the larger picture, EWT wise the situation is pretty complicated. We have what looks like a corrective 3 wave pattern off the 3500 lows, however the drop off the recent highs at 3910 also looks like only 3 waves so far. Given the strong bullish showing on Thursday-Friday it would seem that bulls are attempting to lock-in this 3 wave decline and turn that larger 3 wave bounce into an impulse. 3760 SPX area seems to be the key area to win/defend for both sides. Not surprisingly ML converged there in the o/n and was defended by the bulls. If bulls manage to defend this area, then 3800 is the next lvl above, followed by 3845 and 3895 which are 2 important EWT overlaps.
In conclusion, the immediate trend favors the bulls, as they defended ML and won back macro-ML. They need to hold above these 2 lines to continue the upside. Bears on the other hand would need to prove themeselves by breaking below them. Only if they manage to break back below ML will they be back in the lead.