Tuesday, October 29, 2013

SPX 2-Hour Chart Overbot Rising Wedge Negative Divergence E-Waves

The price action creates a rising wedge and the indicators are overbot with negative divergence (red lines) all indicating a top and spank down needed, however, the S&P futures are up a couple points at this writing. The bulls keep finding a way to push higher fueled by the ongoing QE easy money booze. The thin blue lines show the e-wave pattern which may end in the wave 5 at the top currently. The Fed decision is tomorrow so markets may favor a sideways path until tomorrow afternoon, despite any bounces higher, or drops lower, until Chairman Bernanke brings the tablets down from on high and announces to the minions that QE will continue forever. Traders will bow and worship the easy money news sending equities higher. Any hesitancy in the Fed's language concerning QE Infinity would rattle equities. Projection is for the SPX to move sideways to sideways lower going 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.

Note Added 3:34 PM: The bulls run higher another day and poke the RSI higher. Sometimes divergences are divergences, until they aren't. This gooses price higher for today's session but at this writing the indicators, including the RSI are set up with negative divergence so the expectation continues to be for a roll over to the downside for the SPX moving forward. The Fed is the wild card tomorrow.

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