Likely Capitulation High Yesterday

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The short term rising wedge on SPX either overthrew yesterday or widened into a small rising channel, but the big news on the hourly chart was that the high established a perfect overall rising channel for this move from early December. The AM high today was a slight break below short term rising channel support and on a conviction break below the next obvious target would be larger rising channel support, currently in the 2285 area. I do like a retest and marginal new high from here, that would set up possible 60min sell signals and get SPX a little closer to my 100% fib extension target at 2356/7. It would also give AMZN and TSLA a chance to do the ATH retests that may be required for a swing high here on NDX/NQ. SPX 60min chart:

170216 SPX 60min

Negative divergence was also lost on the daily RSI 14 yesterday but I’d note that the falling channel on NYMO survived the day, with increased negative divergence there. With the RSI this high though, divergence isn’t really needed for at least a short term reversal. SPX daily chart:

170216 SPX Daily

ES expanded from a short term rising wedge into a larger rising megaphone yesterday. Rising megaphone support was broken slightly at the low this morning, but for a real signal of weakness we still need to see a break of yesterday’s low at 2331. ES Mar 60min (pre-RTH) chart:

170216 AM ES Mar 60min

NQ is back in the rising wedge at the low this morning and may have topped, but as I said, I am wondering whether AMZN & TSLA may need full ATH retests before the swing high is in. NQ Mar 60min (pre-RTH) chart:

170216 AM NQ Mar 60min

TF broadened into an even better overall rising megaphone yesterday and barring a possible retest the high there is likely in. Short term rising megaphone support broke at the lows this morning. TF Mar 60min (pre-RTH) chart:

170216 AM TF Mar 60min

One thing that does worry me slightly about this high is that at every significant high or low in the last few years I’ve been accused of being a permabear (at highs) or a permabull (at lows), by those with a bad case of recency bias, and I haven’t had anyone say that to me here yet. I’m hoping that’s not a prerequisite for a turn. I have attracted a couple of trolls in recent days though as the turn has continued to not arrive and perhaps that is enough.

It may be rose-tinted glasses looking back but I seem to recall trolls being more intelligent and better educated a few years ago. One thing that never changes though is the attitude, and the assumption that whoever they are addressing is human slime. That’s natural enough though, it’s well known that a thief assumes that everyone else is a thief, a liar assumes that everyone else lies, cheating spouses are famously suspicious of their own spouses, and sociopaths assume that everyone else just pretends to be concerned for the welfare of others. When these damaged individuals look at others they just see a reflection of themselves. That said, it doesn’t make them any more pleasant to interact with. I’ll be glad when the turn is in & they vanish back under their rocks.

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