SPX 2-Hour Chart Negative Divergence Megaphone Expansion and H&S Patterns

The SPX 2-hour chart shows the negative divergence spank down over the last couple days but the bulls keep fighting back. Yesterday, the intraday high jumped up to 1523.14 which is near the prior top but not quite, therefore, negative divergence cannot exist until a higher high in price occurs. But the indicators are all sloped negatively (thin red lines) so if price can print another higher high at 1524-1525 that would lock in negative divergence and create another pull back. The green lines show a megaphone pattern, or expansion pattern, with lower targets in the 1480's. The blue lines show the H&S in play that would target the strong support at 1505 and 1503.

Looking at the higher volume days over the last couple weeks, the candles, each representing two hours, show the importance of the 1514-1515 level. It is prudent for price to venture lower and test 1514-1515 to see if stronger sell side volume enters, or not. Pay a lot of attention to 1514-1515. The Energizer Bunny may power higher and tag the upper rail of the megaphone at 1527-1529 but as the indicators show, any move above 1524 will result in negative divergence. The markets are simply floating higher despite the indicators wanting to see price move lower. Projection is lower moving forward. 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.