A Bullish Friday Ahead? December 5 Stock Market Preview
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IWM continues leading the way higher, with SPX and QQQ seemingly asleep at the wheel.
Given my past experiences and observations of IWM, I think IWM’s performance alone increases the odds that QQQ and SPX play “catch-up” to some extent, potentially as soon as Friday.
In addition to IWM’s strength, I always try to say something nice about the VIX (great personality!), but there’s really just nothing nice to say at the moment..The Keltners on the 4-hour chart indicate a strong downtrend, the Hull Moving Average is careening lower, and the VIX has been wicking with each attempt to breach and hold above the Hull.
Despite not seeing large GEX at 15, the technicals strongly seem to point to at least a brief spike low near 15 or just above.
The VIX dropping to 15 likely implies the indices rallying, in theory. Threats to the bullish picture include the VIX holding above 16.25, which would likely mean the VIX pummeling is over for the short term.
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SPX is holding above the Hull, and the 7000 GEX cluster we’ve been repeating for months is looming overhead in magnetic fashion. Can SPX find the strength to climb 2.5-3%? It seems like a lot of points, but percentage wise, completely realistic.
Closing with a daily candle below 6825 starts to make continued upside look a bit dicey, so bulls want to see continuation higher soon.
QQQ has been the weakest, and GEX continues heading downward, now almost to the zero line in terms of net GEX.
That said, we still see a large positive GEX cluster at 630, with potential to move to 640, also matching the upper Keltner channel.
Holding 620 is now key. Futures currently show QQQ nicely positive, but it remains to be seen whether or not the rally holds into the cash session tomorrow.
IWM’s high today at 252.66 was .11 below the October high, but the momentum appears stronger this time, and GEX overhead at 255 and 260 that may represent solid targets.
Most of the daily option volume (in light blue) continues to be at lower strikes, interestingly.
Maybe we’re headed for a quick reversal back down after SPX concludes its business toward 7000? I don’t think we’ll have to wait long to find out…
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