The last 2 days felt more like the July we were expecting all month, but ultimately the bulls still came short and July closed red for the month for the first time since 2013. The streak is finally broken. The funniest thing is that with 1 minute to go on the day, SPX was green for the month and the last candle erased nearly 15 points on the day and SPX ended up red for the month. A comical ending.

The daily chart seems to be heading in a vertical direction again. From the low on Wednesday to the high today, SPX has rallied about 200 points in just 2 days. This is quite a large move for such a small timeframe and it is the perfect reflection of the volatility we saw in July. While the month ends on a huge rally, a lot of uncertainty still exists.

SPX spent most of the week sideways and then volatility really opened up and somehow we ended up 78 points on the week. SPX still closed below 7500 despite breaking above it briefly. I wouldn’t call it a rejection yet, but clearly it was unable to sustain momentum above 7500 for the time being.

The craziest part about today was that SPX actually sold off very sharply after the open and even turned negative on the day. We held the 7400 level almost to the penny and then saw a 112 point rally.

The whipsaw price action has been the theme since Wednesday, but out of all the chaos there seems to be a new pattern possibly emerging. There is a pretty obviously higher high / higher low pattern since the lows on Wednesday as highlighted in the chart below.

We’ll have to wait until Monday to see if the pattern holds any weight, especially enough to keep the momentum going. For the time being however, it seems promising.

And lastly our good friend NQ. We know it retook the June lows yesterday with the insane 1000 point rally. Today was mostly a quieter day for NQ and the daily candle pattern is no where nearly as bullish as the one on SPX. The big memory stocks closed down, while chips were mixed. The indecisive doji is the perfect reflection of that.

NQ closed the day only up about half a percent. For now, it seems to be taking a breather at that important 28000-28500 level.

Monday starts a new week and a new month, but I don’t think the volatility is going anywhere.

I’ll have more over the weekend, including key levels for next week as well as the expected move.

Stay tuned!