Tuesday, January 7, 2014

SPX 30-Minute Chart 8/34 MA Cross Potential Falling Wedge Developing

The 8 MA remains under the 34 MA signaling bearish markets for the hours ahead, however, the S&P futures are +7 so the bulls plan on trying to create a positive 8/34 cross after the opening bell. The bears will fold like a cheap suit if the 8 moves above the 34. Bears will rule moving forward if they maintain the negative cross. Yesterday, the opening bell was met with a gap and crap, or pop and drop, if you prefer, so this must be considered today as well. New money comes into the markets at the start of each month typically creating bullishness, especially for the start to quarters and most importantly the beginning of the year. Thus, with three down days ot begin 2014, the bulls are ready to launch a strong bounce higher.

The green lines show the positive divergence that created the mid-day bounce yesterday but note the money flow already turning negative again, and the RSI and money flow never ventured deep into oversold territory and the thin blue lines show the sideways nature of the indicators currently. Bulls need to move up through 1837-1838 to create an upside party back to the all-time highs. Bears need to push under 1824-1825 to accelerate the downside. The brown lines show a potential failing wedge under development that targets a recovery move from the 1810-1815 area, however, a sustainable up move this morning will negate the pattern.

Watch the 8/34 cross. It tells you what you need to know. 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 12:27 PM:  The 8 MA pierces up through the 34 MA at 10 AM signaling bullish markets for the hours ahead.

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