After two hours of trading, the e-SPU remains confined within a narrowing coil pattern, just as we discussed early this morning .
That said, increasingly the pattern is getting "heavier and heavier" in the absence of a pop above key resistance at 1940-1952, which puts more and more intense downside pressure on 1905-1898 support. MJP 9/02/15
Forty-Eight hours from the next key data point-- The Aug Jobs Report-- and what do we see? A coil (What else? This has been the year of coils and ranges in the SPX, no?). The parameters of the coil carved out off of the Aug 24 low at 1831 are: 1940-1952 high-side resistance juxtaposed against 1905-1898 low side support.
If the e-SPU manages to climb above or below the current parameters, then we should expect directional follow-through.
That said, however, with China closed, and major traders on vacation, perhaps we should expect a period of low volatility sideways action into Friday morning's Jobs Report.
Finally, based on my near- and intermediate -term pattern work, I "must" label the action off of the 1831 low as a "Bearish Continuation" pattern because it has developed in its entirety (so far) in the lower 50% of the May-Sep decline of 303 S&P points. If my pattern work proves accurate, then the next catalyst should trigger a downside reaction from the coil... and that will project to a full-fledged retest of the Aug 24 low. MJP 9/02/15
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