Category Archives: Patterns

Food for Thought

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Just a very quick post today as my morning has been hijacked by traffic jams and an ill son, though he’s not seriously ill.

I posted a chart on twitter last night showing that the rising wedge that I posted yesterday morning had evolved over the day’s bullish break into a rising channel, and that the pattern formed from the morning low yesterday was a rising wedge, that is now, just after the open, breaking down.

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The Battle of the Middle Band

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I posted a couple of charts on twitter last night showing the very interesting setup here on ES and SPX. The setup on SPX is the falling wedge that I’ve been showing in recent days and the double bottom with a target at 2054. I mention on the chart that the target area would be a 61.8% retracement of the falling wedge and that might be the top of the rally there, if indeed this is just a rally. SPX 60min chart (posted last night on twitter):

150121-C SPX 60min Falling Wedge and Double Bottom

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Tired Looking Bulls

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Yesterday closed green but was nonetheless a significant technical fail for the bulls, as there was a very strong bottoming setup that needed the opening gap to hold, and it was filled within minutes with a strong rejection from the opening highs. Most of the subsequent dump was then retraced but it remains to be seen whether the bulls can recover back to that opening high at 2029.

If SPX can recover that far then the important resistance levels today are that high at 2029, falling wedge resistance at 2037, and main resistance is at the meeting of broken rising wedge support, the 50 DMA, and the daily middle band all in the 2045 area. SPX daily chart:

150121 SPX Daily Rising Wedge and SR Levels

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Likely Breakaway Gap Over Resistance Take 2

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On Friday night I posted a quick review of the very bullish setup on SPX at Friday’s close and the full post talking about that was posted yesterday. If you haven’t read that yet you can see that here.

In the short term the possible opening gap over resistance that I was suggesting as likely is looking likely at the time of writing. If that persists into the open then the important thing to remember today is that the bulls most likely own the tape today unless the opening gap fills, in which case we might well see a very strong decline instead, and a new retracement low wouldn’t be unusual. ES 60min chart:

150120 ES 60min Oversized IHS

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