Monday, May 27, 2013

SPX 30-Minute Chart 8 and 34 MA Cross Channels Sideways Symmetrical Triangle

The bulls finally receive a downside nod when the 8 MA fell under the 34 MA last Wednesday (red circle) signaling bearish markets for the hours ahead. After only three days, however, the 8 MA is already moving higher converging on the 34 MA which is moving lower for a bullish 8/34 cross after the opening bell Tuesday morning. The bears are not allowed to shine due to the Fed and BOJ pumping the equity markets higher. But, the bears are not out of the near-term gain yet; the first couple days of trading this week are very important. The bears need to drive the SPX lower at the opening bell tomorrow to curl the 8 MA to the downside again and resume the market selling. Note the pink circles as price moved higher, each time the bears were ready to create a negative 8/34 cross, the bulls came in to spike the 8 MA higher. Perhaps this time the bears will force the 8 MA lower. The futures ahead of the opening bell are key; the bears will need to see a 3 or 4 handle negative bias, preferably more, to at least stem the tide of the rising 8 MA.

Note the thin black lines that show a sideways symmetrical triangle in play right now and Friday's action touched the top and bottom trend lines. The decision up or down come tomorrow morning is likely very important since it may create a 20 to 25 handle move for the lucky side that wins. A breakout above 1650 would target the 1666 and 1669 resistance levels and the 8 MA would cross above the 34 MA signaling bullish markets ahead. If the bears eat their Wheaties for tomorrow morning, and push under 1647, the 1622-1627 area is targeted. Watch the 8 and 34 MA's to see if the bears keep the ball and run lower, or, if the bulls take the ball back and move higher for a potential M top pattern. 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.

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