Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Thrills and Spills

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Well I was saying yesterday morning that I was uneasy about the lack of a retest of Monday’s high and that there was still plenty of scope for surprises between 1935 and 1904 SPX, and we had a very impressive reversal yesterday after SPX made a marginal new low at 1925. That reversal was an amazing 45 points from the morning low to the closing highs, and brought to mind some pleasant hours I spent a while back in Las Vegas getting an adrenal gland workout at the High Roller, which at that time then sported the highest rollercoaster in the world among other terrifying rides. I was sad to read that this was all demolished in 2005, as I would have loved to do that all over again as and when I return to Las Vegas. Las Vegas – High Roller:

las-vegas high roller

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Limbo Dancing

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SPX followed through to the downside yesterday and we have now seen the opposite of the many V shaped recoveries that we have watched on SPX over the last two years. It has been a while since we have seen one of those. SPX closed back under the daily lower band, confirming the end of the rally. SPX still needs to break under last week’s low at 1926, and under that I have the 38.2% fib retracement of the 2014 rising wedge at 1912, and both main double-top support and the 200 DMA at 1904. For the full retracement scenario back under 1800, that 1904 level is the important level that must be broken. SPX daily chart:

141008 SPX Daily Trendlines BBs MAs

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Unfinished Business

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The SPX daily RSI 5 closed at 32.79 yesterday, and the retracement is now larger than two of the past 29 signals since the start of 2007. SPX has reached a level where a low wouldn’t be an extreme statistical outlier. This isn’t a false signal that is part of a larger sell signal forming however, so once I strip out the four of those, then 20 of the remaining 25 signals made it to the target level at 30 on the RSI 5. This retracement may well make it there as well.

There is something else to consider as well. SPX has broken below the daily middle band, and confirmed that break by holding below it yesterday. When this happens then there will be a test, most of the time, of either the daily lower band, or a significant moving average. My eye is drawn to the daily lower band at 1976.62, and the 50 DMA at 1972.56. Both of these are decent targets for any further move down. SPX daily chart: (more…)