The Trading Note on July 28 highlighted some levels to watch on the S&P 500 (SPX) to confirm if a pullback was going to be a trend changer or just a brief pressure release, states Ian Murphy of

On a daily chart, Friday’s positive bar which closed back above the EMA having found support at the -1ATR appears to suggest this was a brief pullback in the bullish trend. The Composite Help Indicator, which is a merger of yearly, quarterly, and monthly new highs and new lows is also back above zero, another positive sign. Let’s see what the remainder of the week brings.

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The weekend note which suggested adding Vanguard’s Real Estate ETF (VNQ) to a weekly trend following watchlist because it may turn out like Carnival Cruise (CCL) prompted queries if an entry on the latter was still possible at this late stage—it is.

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Using a 50% retrace of the tall price bar as a soft stop ($16.39), we can enter if this week’s price bar closes positive and closes above the retrace line. Then going forward, we switch to the -1ATR line when it gets above the 50% line.

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