Friday, November 21, 2014

SPX 30-Minute Chart 8/34 MA Cross

The bears got punched in the face again today. The ECB and PBOC provided the one-two punch laying out the bears that are now shell-shocked from the one-month parabolic move higher in stocks. The 8 MA is above the 34 MA on the 30-minute signaling bullish markets for the hours ahead. Bears got nothing without the 8/34 negative cross. The 8 MA is 2061 so the bears must keep price under 2061 to curl the 8 MA lower towards the 34 MA. The bulls are fine and dandy if price stays above 2062 and moving higher. Note the peak in the RSI occurred with the price peak so negative divergence did not print, thus, price would be expected to return higher to the highs.

The gap below is big enough to drive a truck through so price will have to retreat and visit that area. If price falls to 2058 then collapses through the gap to 2053 that would be an island reversal pattern. The expansion pattern is in play now as shown by the red lines. Price should return to the 2070+ highs and then roll over filling the lower gap or producing the island reversal and move to the lower rail of the expansion pattern. The central bankers created the market rally today but on first blush they may have not received a lot of bang for their buck. 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: Keybot the Quant algorithm remains bullish and continues to track volatility and copper, VIX 14.36 and JJC 36.99, respectively, as the two key drivers of market direction for the last two weeks. One of these critical bull-bear levels will flinch. The previous two days bears pushed volatility higher with VIX above 14.36 but ran out of gas. Today the bulls push copper higher with JJC above 36.99 but ran out of gas. Neither side wants the ball. The markets will not head in an extended firm direction until either the VIX or JJC flinches. The SPX is at 2064 moving higher towards the highs so this is not surprising as per the RSI above and green lines that are long and strong. The 8 MA in the chart above will drift higher and remain above the 34 MA unless the bears can move price under 2061. VIX 13.21 (under 14.36 causing market bullishness). JJC 36.70 (under 36.99 causing market bearishness). The beat goes on. Watch volatilty and copper to see who wins.

Note Added 3:54 PM: SPX 2062. VIX 13.17. JJC 36.74.

Note Added 5:15 PM: SPX 2064. VIX 12.90JJC 36.76.The SPX is up 11 points, +0.5%, printing a new all-time intraday high at 2071.46 and new all-time closing high at 2063.50. The circus continues. Watch copper and volatility; one of them is going to flinch.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.