The index not only reached the 1/2 margin zone but also pushed higher. We have now shifted into a bullish margin cycle. The optimal entry for long positions would be a pullback to the 1/4 zone, specifically around the 29,100 level, should the market offer such a retracement.
We are currently testing the balance area and the 3/4 margin zone. Effectively, this serves as a resistance area due to position rebalancing taking place within these levels.
If the price fails to pullback to the 1/4 zone, I would prefer to remain sidelined and wait for a decisive breakout above the 29,500 area.
The index immediately fulfilled the full bullish margin cycle on the gap. The close above this area occurred during the CME holiday (no clearing took place).
However, at this moment, I anticipate a test of the put spread strike at the 30,000 level.
I also allow for the possibility of option balances being settled in the 29,550 area.
