SPX 30-Minute Chart 8 MA and 34 MA Cross
Watch the 8 MA and 34 MA potential upside cross today to gauge if the market recovery move has legs, or not (the S&P futures point to a higher open). If the 8 moves above the 34 the rally has legs for a few hours and days ahead. Currently, the 8 is under the 34 so the bears rule for the hours and days ahead. The green lines show positive divergence over the last two days that will help create this mornings bounce. Over the last few hours, however, the red lines show that some further weakness in price is desired. The RSI and ROC show the sideways nature of price movement currently. SPX 1409, 1413, and 1419 are strong resistance levels above. A lot can happen but look for a price move to the 1413-1419 area and if the 8 MA is not above the 34 MA the move will fade and price will drop. If the 8 MA moves above the 34 MA, the SPX will likely move up thru 1419 to 1424 and perhaps higher. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Note Added 10/26/12 at 6:00 AM: The 8 MA finished the Thursday session remaining under the 34 MA so the bears rule. Considering the AMZN and AAPL earnings disappontments last evening, it appears the 8 will likely stay under the 34 which forecasts bearishness for the hours and days ahead. The GDP and Consumer Sentiment economic data is important this morning.
Hi Key!
ReplyDeleteLove this site. My first read of the day. Just want to point out an error. Positive divergences do not 'want' anything. They are merely a mathematical relfection of price.
Given your quant skills I am sure that you know that RSI is a diffusion index, nothing more. When it crosses 50 the 28ema crosses price. Thats it. Math pure and simple.
Great cross market analysis.
Yep Anon but as you develop as a trader you want to develop the 'feel' of the markets. Many indexes take on a personality of their own and you become intimate with their individual nuances over time. By describing the charts, indicators, technical analysis and so forth in more human terms, it helps to communicate their forecasting ability and also to provide that feel for the markets moving forward. In essence, it helps to take the more analytical aspects and communicate them in a creative way, left brain, right brain type stuff.
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