I’ve mostly been looking at charts with double-tops forming this morning. First I’ll show the possible major double-top that may be forming on the SPX daily chart. That would trigger a target in the 1625 area on a sustained break below 1737, but in practical terms a break below strong rising support from the 1560 low, now in the 1750 area, would look extremely bearish. This is not my primary scenario here, but I’ll be considering it seriously if we should see SPX break under strong support in the 1800 area. Short term the best reversal signals on the SPX daily chart are from divergences on the RSI 5, and we have a bearish negative RSI 5 divergence forming there now. SPX daily chart: (more…)
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Ten Green Candles
ES closed green again yesterday, delivering a second run of ten consecutive green candle closes since 2000. Looking at the overnight action I doubt that we will see a third record-equalling eleventh green candle today. At the moment ES is trying to hold 1830 and we might still see a test of the 1851 SPX high if it can hold. If 1830 breaks then the double-top target is in the 1822.50 area. ES 60min chart: (more…)
Wedges Turned Channels
Well somewhat to my surprise SPX bounced at my highest retracement target yesterday, and that was at the 50 DMA. The broken rising wedges on SPX and NDX both established rising channels at the low, and I posted the SPX channel on twitter later with the comment that there was no longer a retracement setup there unless the rising channel should break down. That remains the case this morning of course and I would add to that the note that the rising channel is rising at better than ten handles per day, so it is likely to break down within a few days at most. SPX 15min chart: (more…)
Retracement Targets
I gave the remaining significant resistance level on ES/SPX in the 1824-8 ES range yesterday and the reversal at 1823.5 was at the bottom of that range. ES has now broken down from both the rising wedge and the 50 hour MA and I’m expecting more downside, though I would add the caveat that at this stage in a rising wedge breakdown there is often a retest of broken wedge support or a test of the highs to establish the second high of a double-top. We could still see that happen here. ES 60min chart: (more…)
Ripper
Instead of a retracement yesterday there was another face-ripper trend day that blew through all of the resistance levels I was looking at yesterday morning on SPX. I looked again at what I wrote on my weekend post about the very bullish history of the weekly candle we saw last week: (more…)
