Gann Mass Pressure index points to lower Equity prices from April-September

SPY - (3-5 Days)- Bullish but still evidence of markets trying to push up into/post Inauguration & little actual weakness in the indices themselves, despite the rotation. Look to sell into 384-5, then 387 into late January, but need to get under 364.82 to care for any sort of pullback

FEZ (3-5 Days)- Bullish - Prices have stalled out but will raise stops to 43.93 and FEZ failed to make the same kind of reversal as US indices did and remains stronger near-term.

Technical Focus list 1/20/21

Key Technical developments worth highlighting:

1) S&P and NASDAQ both pushed higher and while trend has been sideways since Jan 8 coinciding with Dollar bottom, still tough to argue for weakness. Move to marginal new highs looks likely over next week or two before any peak. A pullback to new three-day lows is necessary to expect immediate downside followthrough

2) US Dollar pulled back after its recent two week rally but is setting up for a larger move higher in DXY over the next couple months. Weakness into early February should be used to sell EURUSD, GBPUSD

3) Sectors related to Biden's presidency look to be thriving ahead of the Inauguration, namely, Clean Air/Green hydrogen plays, Cannabis names which might benefit under US legalization, and Gun/Ammo stocks which have perked up given possible unrest given a 2nd Trump impeachment ahead of the Inauguration. These all still look favorable technically, and should be favored

4) Emerging markets have rallied up to within striking distance of all-time monthly high closes, going back since 2008. This is thought to provide at least a temporary stopping point for EM while Dollar turns higher for larger bounce

5) Technology and Financials both showed signs of turning back higher to the tune of 1%, and for now, are helping this market to extend gains, while LAST week's outperformance in Defensives took a back seat on Tuesday.

6) Crypto bounce has helped many of the Alt-coins like ETHUSD and LTCUSD to show better relative strength of late than Bitcoin. With ample evidence of this being a near-term "crowded trade" coinciding with bearish cycles for the months ahead, gains should be used to take profits into end of month.

7) While Non-technical in nature, Yellen's talk of "going big" with large stimulus is certainly being embraced by risk assets as most believe the "worst is behind us" with Virus. This seems to be thoroughly baked into sentiment.

S&P has largely gone "sideways" since Jan 8 just at a time that the US Dollar bottomed. While it's felt far more robust and bullish, markets have largely gone sideways. This corrective pattern normally "DOES" yield to a final push to new highs which should be sold. In this case, movement up to 3875-3900 is thought to be quite stretched on this current move given sentiment levels and February has the potential of being "down" .

US Dollar pullback in the last 24 hours cancels the breakout attempt for now, and Equity markets should rally further on any break of this two-week trend. Yet, this base is very much Bullish on a longer-term basis over the last month and should lead to higher USD Prices into the Spring.

Gann's Mass Pressure index points to a Spring Peak. The Mass pressure index, which is derived from past cycles of 80, 60, 40, 30, 20 and 10 years back , overlaid, often is very insightful in showing trend and turning points for any given year. This year's model based on my Optuma chart shown above, shows choppiness from February into March expiration, then a sharp rally into mid-April which could mark a meaningful top for 2021. Sideways action results and then a downturn from May into June and then a more severe downturn from July into September before a bounce into November. While these often give similar thoughts to the Decennial cycle, they're very worthwhile to keep a close eye on for changes in trend and reversals, which this year, seem to follow the traditional seasonality very closely.

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