Buying Pullbacks - Market Analysis for Jan 22nd, 2023

In last weekend's report, we wrote:  "On price, a pullback down to 3950 area or even 3900 would not surprise me." Indeed, we got the pullback which tested the 3900 support area in the Emini S&P 500 (ES) before a strong rebound to end the week above 3980.

Looking ahead, price action is bullish short term, neutral/bullish medium term and neutral long term.  We have resistance in the 4020/35 area next, and clearing this will likely get us up to the 4080/4100 area quickly. I do think we may get at least a pullback in the coming week, maybe more.  However, as I updated last week, long-term internal signals are on buys right now, so pullbacks are likely to be bought. 

Our Odds Indicator also continues on a buy signal.  Short term internals are mixed but improving.  We have support below at 3975/70 and the 3950-30 area.  As I wrote above a pullback to test those areas in the coming week is likely, and if that lower area can hold, we can build a base from there for the next leg higher.

Grey zone resistance at 4018-35 and then in the 4080 area. Support is at 3973-58, 3911/3896 and then the 3850 area.

For Monday, daily pivot is at 3963.5.  Resistance R1 is at 4015 and R2 at 4042. Support S1 is at 3936.5 and S2 at 3884.5. 

 All the best to your trading week ahead.

Princely Mathew hosts The Smart Money premium service at ElliottWaveTrader.