Tuesday, June 4, 2013

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

The 8 MA is under the 34 MA signaling bearish markets for the hours ahead, however, the rally yesterday off the lows has curled the 8 MA upwards setting up a potential positive 8/34 cross to place the bulls back in control. The brown symmetrical sideways triangle results in a price failure at 1652. The vertical side of the triangle is 32 handles so the downside target is 1620. Price printed a LOD yesterday at 1622.72 only a couple points away so the target and pattern is satisfied.  The blue descending triangle experiences a break down at the 1640 base line on Friday. The vertical side of the triangle is 47 handles which targets the 1593-1600 support zone so this pattern remains in play.

On the weekend, this chart was looking for a back kiss of the blue triangle base line failure at 1640 and yesterday's action fulfilled this request. Now price must decide to bounce or die from 1640, either returning into the safety of the blue triangle, or, collapsing after this back test. The RSI, stochastics and money flow all sneak above 50% into bull territory. The indicators are long and strong (green lines) wanting to see further price highs after any pull back so this hints that the test of 1649-1650 resistance is a distinct possibility today.

The key to the 30-minute chart is always the 8/34 cross so the bears must open the markets down and move the SPX under the 8 MA at 1631.51 as soon as possible to curl the 8 MA back to the downside. The bulls will simply use the momo developed yesterday afternoon to continue higher. Watch the 8/34 cross since this will confirm the bulls driving the bus for the hours ahead if the 8 moves above the 34. 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 6/5/13 at 5:00 AM:  The 8 MA almost crossed above the 34 MA yesterday but was spanked back down as the markets sold off in the afternoon. The 8 MA remains under the 34 MA signaling bearish markets for the hours ahead.

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