Monday, May 27, 2013

SPX Daily Chart Upward-Sloping Channel Negative Divergence

The brown upward-sloping channel top rail resistance, and negative divergence, spanked price lower a few days ago. Ahead of the holiday weekend on Thursday and Friday, the bears push lower but both days show the candlesticks recovering with plenty of dip-buyers willing to buy the market. The thin small blue circle show a potential tweezer bottom and sets up a dead-cat bounce.  All indicators are weak and bleak wanting to see lower lows print for price even if a bounce occurs. The all-time closing high is 1669.16 so a price bounce to test this 1669 resistance level is not unreasonable, however, further weakness is anticipated.

May started at 1597.57 so another up month will print on Friday unless the bears come to play and drive markets south out of the gate to lose 50 handles in four days and log a negative month under 1600. SPX S/R is 1687, 1669, 1666, 1649-1650, 1634, 1626-1627, 1618, 1614, and 1597-1598. Projection is sideways to sideways 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.

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