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I was talking on Friday and Monday about the likely topping process now in progress on SPX here, and the possibility that SPX would head down into the possible H&S neckline in the 4070 area, supported by the daily RSI 5 sell signal that had fixed. That target was reached yesterday, and the daily RSI 5 sell signal made and exceeded the target at the 30 level on the daily RSI 5.
SPX daily chart:
As I was writing on Friday, SPX is testing major double resistance at the month middle band and a key trendline from the 2009 low. With a daily RSI 5 sell signal fixed on SPX, at least a decent retracement here looks likely, and that may develop into a decline into a new bear market low under 3491.58.
SPX monthly chart:
This is just getting sad……………
The main resistance for the downtrend on SPX since the all time high is twofold, and those two resistance levels are currently crossing.
The first level is the monthly middle band, which has a long track record of acting as main support in an uptrend, and main resistance in a downtrend. That is currently at 4173 and the high this week was at 4169, so that was an almost perfect test.
The second level is the trendline from the 2009 low that was resistance in 2010, then resistance for multiple tests in 2012-14, 2018 & 2020 until it was broken hard in the collapse upwards after the 2020 low. After that was broken as support last year it has held as resistance twice, and has seen a third test this week that has held perfectly so far.
(more…)I haven’t posted much lately as we have been in this continuing choppy move up in the past two weeks. Not much has changed now, but I can give some additional insight as to where my trade is and what I am prepared for.
