Tuesday, July 16, 2013

SPX 30-Minute 8 and 34 MA Cross Overbot Rising Wedge Negative Divergence

The hourly and minute charts are set up with rising wedges, overbot conditions and negative divergence across all indicators so a smack down should be at hand. Price should tease the lower red trend line at the opening bell where a bounce or die move will occur. Another tap of the top rail at the all-time high at 1687-ish cannot be ruled out, however, any additional upside will likely result in additional negative divergence. The bulls are enjoying a seven-day rally since the 8/34 MA positive cross occurred. Bears got nothing unless they move the 8 MA down through the 34 MA. The 8 MA is 1682.77 so as long as the SPX stays under this level the 8 MA will curl to the downside for a potential negative cross. For now, the 8 is above the 34 signaling bullish markets ahead. Projection is for the negative divergence spank down to occur, and the lower red trend line to fail sending price lower to test support at 1677, 1672, 1669, 1666 or 1652.

If bearish, you want to see the negative divergence spank down occur and the 8 MA to stab down through the 34 MA to signal bear markets ahead. If the VIX moves above 14.20, the bear path for the hours and days ahead will gain momo. If the SPX drops today, but the VIX stays below 14.20, the bears got nothing and the SPX will recover and move higher. 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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