Virtually in accordance with the textbook the S&P 500 continues working off its schedule prognosticated by the GUNNER24 Forecasting Method in price and time. The ups and downs since June must have produced dozens of winners for the short-term oriented GUNNER24 intraday and swing traders. Well, within the free GUNNER24 Forecasts we are but concentrated to the position trading. And for all of us who are keeping a daily long-position now – after the development of the past few days – the highest possible concentration is due to catch the perfect exit out of our long-positions.

As an introduction into today’s issue here’s again the S&P 500 schedule of last Sunday:


The most important July resistance in the S&P 500 is the monthly resistance Gann Angle at 1374. Last Sunday I newly pointed to the extreme importance of this resistance… From this important resistance the buy target in the daily setup above results: 1374. Furthermore, in the last issue I pointed to the expectation of an overshooting of the resistance until Thursday of last week until 1380. From there and at that time the market would have had the possibility to shoot up to its July exhaustion target at 1389 and turning down from there.

But the market only worked off the 1374 and the 1380 before it swung down:


On Tuesday, 07/03 the highs were lying at 1374.81, on Thursday, 07/05 the market showed a rather rare performance topping, as it were, “secretly” at the lower line of the 2nd arc 1379.93 during the Europe trading hours, so it didn’t suffice any more for the 1380 topping during the regular trading hours.

That effect was owed to this fact: The corresponding futures contract of the S&P 500 that is showing more or less the same daily up setup met its next resistance – the lower line of the 2nd - as early as premarket, then turning.

And since the S&P 500 – as all the markets do – depends on the corresponding future contract like the tail of a dog hangs on its body the S&P 500 was forced down without reaching its main target in its daily up setup which is the lower line of the 2nd double arc. But: What isn’t yet may well still be. The market will have to reach the lower line of the 2nd. Without considering the mass of the market participants no sustainable downturn can happen. That’s a fact!

Following the fact that by the middle of the week 1374/1380 were reached being thus worked off some important targets the market had to turn down consequently. Now it’s on its way to its most important support at 1338. That’s where the first double arc and its most important daily support, the actually determining Gann Angle are combined. We have to expect that the index will turn up again there – on Tuesday or on Wednesday. So all in all we’ll have seen 4-5 days of correction then. The 1338 are lying exactly on the Gann Angle, but the past tells us that the market is allowed to dip a little beneath the angle intraday! A daily close below 1335 will not be allowed next week, otherwise a slipping-through to the next important weekly support will threaten. That one is at 1325. We’ll see more about it below in the weekly setup.

I don’t expect that to happen. I expect that at the latest on Wednesday from 1338 to 1335 the market will start its last wave to the top that is supposed to be at least within the 2nd double arc.

I mean it’s newly going to be 1380, technically a little higher, maybe at the very most important monthly resistance at 1389. It’s because the market is following a clearly visible Gann Angle corridor. From above it is limited by the resistance Gann Angle that started from the final October 2011 lows. Below it is supported by the daily support Gann Angle. Both angles indicate us a rising wedge so to speak. Merely theoretically the market is expected to fall out of it by the end of July 2012! We’ll cover our long positions at the first closing price within the 2nd double arc:

Please do cover within the 2nd, too. On the one hand I won’t be able to produce a new outlook next Sunday. I’ll grant myself some vacations, so the next free forecasts won’t be issued before 07/22. On the other hand the rising wedges use to be very fragile patterns that may lead to fast, tough declines when they’re left downwards.

Weekly view:

Also in the weekly time frame we make out a beautiful rising Gann Angle corridor!


We start the weekly up setup at the final October 2011 lows drawing the setup a little bit to the right above and looking for a Gann Angle that is showing a strong influence to the price. The possible anchor points are always to be looked for at the upper edge with the important time lines. In this case we can identify a resistance angle we may anchor at the transition from the fourth to the fifth horizontal square. Then we go on drawing the setup to the right above until the blue arc fits tightly with the top of the fifth week:


Wonderfully to be seen is now the mentioned Gann Angle corridor. Above is the resistance Gann angle, from below the important 1*1 angle is supporting the weekly time frame. If next week a daily close below 1335 happens, at any rate the market shall start its last three week up wave at 1325 again. Each weekly close below the 1*1 will be a weekly sell signal!

We further make out many different important resistances from 1374. There is the first important horizontal resistance starting from the intersection point of the lower line of the first with the beginning of the setup. Above that there is the next important horizontal resistance starting from the upper line of the first at 1392. I think between those two horizontal resistances in the weekly time frame at a 90% there is the expected final top of this swing. I guess there is just a 10% chance that the market will reach the lower line of the 2nd at 1405 still in this swing by the end of July.

As to gold, in the last issue I pointed to as little as a 10% chance for overcoming the actually dominating elliptical resistance:


Well, again the precious metal bulls were disappointed. Newly the short sellers maintained their superior position. Newly the metal was pressed down by the daily downtrend line that has been dominating for more than four months. But next week the true decisive battle is coming up:


At first I adjusted the elliptical resistance to the highs of last week. We can see that gold succeeded twice to spike over the elliptical resistance. Even though it was narrow, but for this resistance the signification is that it was tested more emphatically than it was the first two times. In addition last week a daily close and a daily open were exactly at the resistance. In terms of time gold remained at the resistance longer than it ever did in the past. The force of the bulls is increasing. But as expected, also in the third test gold was rejected again coming now into the phase when the decisive attack to the resistance is to be expected. The fourth test of this resistance is always the decisive one. The important Gann resistances and supports mostly break at the 4th test. That is why in the next try gold will have the highest probability of breaking this resistance finally. It’s a 70%!!

But the precondition is that on the one hand the key support angle or the 1*2 below the price will resist on Monday and on Tuesday on closing price basis as well. I really expect that to happen. From there the market is supposed to tackle newly the elliptical resistance breaking it in the next try. The earliest deadline for the break will be next Thursday.

But if the 1*2 falls at the beginning of the week, i.e. a daily close below 1565, We will see some new lows with a 30% of probability.


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Be prepared!

Eduard Altmann

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