Monday, May 5, 2014

SPX 60-Minute Chart 200 EMA Cross Tight Band Squeeze

Remember last week the 30-minute chart had the tight band squeeze that sent price from under 1880 up to 1891. Today it is the 60-minute chart's turn. The tight bands (purple circle) shows a strong move on tap up or down. Judging from the S&P futures to begin the week, at -8, it appears that the bears may win this one. Strong support exists at 1878, 1874 and 1868. If this fails, price will target 1859 then the starting year number at 1848.

The SPX is above the 200 EMA at 1865.80 signaling bullish markets for the hours and days ahead, however, bears may try to make a run at a negative cross today. Bears got nothing until they print under the 200 EMA. The indicators are weak and bleak (red lines) wanting to see lower lows in price. Note the RSI fighting hard to prevent a drop under the 50% level into bear territory. Extended selling will begin if the RSI loses the 50 level.

The SPX is moving sideways through 1848-1891 since mid-April so the breakout from this sideways range will identify the winner going forward. Projection is for more sideways ahead but if the 200 EMA fails, the stock market will become very ugly very quickly. 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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