The Quarterly chart (chart1) may be the key for understanding this large range. After a big momentum up, the price managed to take out the major Last Low Before High of point A (at point B). But instead of consolidation and holding in the lower range, the price did a remarkable recovery back up to the upper side of the range. That would still be a clever distribution had we discovered at the top of last Quarter a new signs of weakness. But instead, we got a Higher High in this Quarter, made on this April (going above point C).

So, unless we see contradicting indications, we should assume now that any coming decline is part of an accumulation for the next move, rather than distribution (in order to go below point B).

S&P Futures Quarterly Technical 30-APR-2016

Chart1:  S&P Quarterly chart (at the courtesy of prorealtime.com)

On the Daily chart (chart2) we already see a declining price structure of Lower Low proceeded with a Lower High and then a new Lower Low. Going short below last Friday’s Low (2045.75) is a good bearish signal only if the price holds at least two more days in a sideways/correction manner without taking out Friday’s Low. Expect strong support at the 50 SMA (blue) below the lower Bollinger Band, and at the 200 SMA (black). Had the price taken out the 2026 level, the road down to the most important support at 1940-1946.5 would be wide “open” (though it doesn’t mean there won’t be a deep correction up after that).

The most important level of support from which a new bullish wave can emerge and take the all time high (aims towards target of 2260 ~) can start from the 1940-1946.5 levels. Consolidating deeper below these levels will be a major sign of weakness, and should be addressed at that time.

S&P Futures Daily Technical 30-APR-2016

Chart2: S&P Daily chart (at the courtesy of prorealtime.com)

Disclaimer: Anyone who takes action by this article does it at his own risk and understanding, and the writer won’t have any liability for any damages caused by this action.