There are major economic reports being released this week.
On Wednesday we have the Producer Price Index (PPI) at 8:30 a.m. Eastern following the Federal Open Market Committee (FOMC) minutes at 2:00 p.m. Eastern. To end the week, we have the Consumer Price Index (CPI) on Thursday and the Retail Sales report on Friday, both at 8:30 a.m. Eastern.
After rallying on Friday, the S&P 500 (/ES) sat at $3,792, its point of control (POC). /ES then broke a major structure to the downside, breaking last month’s POC at $3,669. The major index ended the week at $3,639.
This week, see if /ES can hold $3,639 and pop toward structure around $3,700. If /ES continues higher from there, my next target is the previous gap-fill target of $3,735. If /ES breaks $3,639 and heads lower, my first target is $3,613. My second target is the low of the year at $3,571.
For a bigger picture thesis, if /ES can’t hold the low of the year at $3,571, my major downside target is the pre-COVID-19 high of $3,397.
Last month’s thesis that the Volatility Index (VIX) would approach $35 unfolded perfectly with the market. As the market goes lower, VIX will move higher toward $35 again. If VIX guides lower and causes the market to pop, it could break $26 and make its way to $25.
AAPL continues to be our compass for the market. See if AAPL breaks structure around $140 and moves toward $137. Similar to the market, I have a major downside target of $129, the low of year. If AAPL holds structure around $140, see if it can pop toward $146 and head to $149, the daily 21 exponential moving average (EMA).
My main focus for this week is SPX. Watch the video above to see which key levels and structure I’m noting on /ES.
Stay Focused!