Sunday, June 9, 2013

SPX 1-Hour Chart 200 EMA Cross Downward-Sloping Channel S/R Levels

The most important item on the 60-minute chart is the 200 EMA. The SPX is above the 200 EMA at 1629 signaling bullish markets for the hours and days ahead. The market bears cannot catch a break. The times have been lean where price is pushed sub 200 EMA  to favor the bears and each time this year that it occurs, the bulls slap the bears silly and reverse the 200 EMA cross quickly.  On Friday, the bulls ruined the bear fun once again. Bad things happen to the market when the 200 EMA fails but the failure must remain in place more than a day or two. Watch 1629 as key support below; bears obviously need sub 1629, otherwise, they got nothing.

The chart shows how price continues to make lower lows and lower highs which is bear-friendly. Watch to see if price moves higher to turn this negativity around. The downward-sloping channel is in play and on this chart price has popped above the top rail in the final hour of trading Friday. Watch to see if price comes back for a test at 1637-ish in Monday's trade. The stochastics and MACD histogram are already wanting to see price roll over to the downside again. The RSI, MACD line and money flow, however, want to see additional price highs. The RSI is not yet overbot further reinforcing the idea of further price elevation. If it takes from 3 to 6 candlesticks for the indicators to agree on negative divergence and overbot conditions, that is about 3 to 6 hours of trading time for 1-hour candlesticks. This hints at sideways to sideways up movement into Monday afternoon where the roll over to the downside may surface.

Key support and resistance levels (S/R) are 1687, 1669, 1666, 1652, 1650, 1649, 1647, 1634, 1627, 1626, 1623, 1618, 1614, 1598, 1597 and 1593. As discussed all weekend, there is a confluence at 1646-1653 which not only encompasses the key horizontal support but also the 20-day MA and the 62% Fibonacci retracement for the May-June selloff. Thus, 1646-1653 is a key resistance battleground for bulls and bears with bulls winning above 1653 and bears winning if price stays sub 1646. Projection is for the 1646-1653 resistance gauntlet to hold and for price to roll over to the downside again. Watch the 200 EMA at 1629 since if it fails again early this week, the markets are likely going down hard. Bulls do not have a care in the world, since the broad indexes will remain buoyant, if the SPX stays above 1629This 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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