Tuesday, November 5, 2013

SPX 30-Minute Chart 8/34 MA Cross

The bears are not allowed to have fun thus far this year. Each time the downside begins, verified by the negative 8/34 MA cross, the bulls squash the party. The low volume yesterday allows the jello to be pushed around the plate easily so markets were stuffed higher into the closing bell. The bottom on Friday occurred due to the positive divergence, however, the RSI never reached oversold levels and the MACD line actually wanted to see lower lows print moving forward. The factor most influential is the daily Fed pumping. There is a Fed head, now sometimes 2 or 3 per day, repeating the QE forever mantra to keep the stock market elevated. Even the once hawk Fisher praised QE over the last couple days again. The Fed members themselves are now drunk on their own wine, staggering along the hallways, and bouncing off the walls of the Eccles Building. There are very interesting and historic market days ahead in the very near future.

The 8 MA crosses above the 34 MA yesterday signaling bullish markets for the hours ahead. The bears need to move the SPX at least under 1766 to curl the 8 MA downwards for a potential negative 8/34 cross. Without the negative cross, the bears got nothing.  The price action yesterday builds a rising wedge pattern with negtively diverged histogram and ROC. This hints at a pull back on tap, and the futures are -5, but the RSI, MACD line and stochastics are all long and strong wanting to see another matching or higher price high to allow time for these three stooges to set up with neggie d. Stochastics are now in overbot territory. RSI may want to tap on the overbot level at 70% before price turns lower. Key S/R is 1775, 1772, 1769, 1763, 1759, 1752, 1745, 1730 and 1733. There is a gap at 1762-1763, also at 1747 and also at 1730-1733.

Price should maintain a sideways move teasing to and from along the important 1769 resistance. A move up through 1769 would send price for a test of the all-time closing high at 1771.95. This 1769-1772 zone should be sufficient enough to allow time for all the indicators to negatively diverge. So today may simply be another sideways stumble. Markets may be favoring sideways action through tomorrow since the fireworks begin bright and early Thursday morning with the ECB rate decision and press conference before the Thursday opening bell. The GDP is also released. Then the Monthly Jobs Report Friday along with Consumer Sentiment. The CPC and CPCE put/calls must be respected for the short to intermediate term time frame so it would not all be surprising to see the all-time intraday high at 1775.22 hold as a multi-year high moving forward. A multi-week high would likely be a given if the market selling initiates this week. If the all-time high is taken out this week, the new print may easily serve as the multi-week high and perhaps multi-year high. The put/call ratios indicate that markets are at a significant top right now, or within days. 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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