Potential counter trend rally signs:
10/13/22 SPX high volume reversal day.
Highest volume upside day since June 24.
– Fed funds futures priced in max bearish at 2 x 75 bp hikes.
– Bond yields at 12-year highs at 4.00.
– Seasonality: 1980-2020
– SPX max oversold oscillator on 9/26.
What to watch for: SPX two closes over the 20-sma.
Bullish 8/20 MA cross.
High-volume follow through day on day4 or later (WON).
Bond yields to hold at 4.00 or lower.
VIX to start to trade below 30.
Better than expected earnings reports.
First targets: 3800-3900 based on a 50% retracement of 4300-3500 or 4100-3500.
Individual time frames are a key factor.