Tuesday, December 9, 2014

SPX 2-Hour Chart

The 2-hour chart receives the spank down from the overbot conditions, rising wedge and neggie d (red lines). Note how price has already violated the lower standard deviation band (pink) so a move back up to the middle band, which is also the 20-day MA, at 2067 is in play. The brown circles show the prior time that price violated the lower band; it led to a move back to the middle band and all the way back up to a hair from the upper band. If price recovers that would form a right shoulder for the neon blue potential H&S pattern. The H&S pattern would target down to the support at 2005-ish. There are gaps that will need filling down below current levels.

The stochastics are positively diverged helping to create the intraday bounce. The MACD and ROC, however, remain weak and bleak hinting at another test of today's lows ahead. The SPX 1-hour chart also shows the MACD line continuing to slope downward. The SPX Support, Resistance (S/R), Moving Averages and Other Important Levels for Trading the Week of 12/8/14 missive on the weekend highlights 2046, 2040 and 2038 as very strong support and price is trying to recover at this support. Key S/R is 2073, 2065-2068, 2056-2057, 2052, 2046, 2040, 2038, 2032 and 2024This 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 12:52 PM: The SPX recovers to 2049 above the strong 2046 resistance so price will set sights on 2052 R next. VIX is 15.72 remaining elevated above the 14.43 bull-bear level identified by the Keybot the Quant algorithm. The NYA recovers strongly to 10794 holding the 40-week MA support at 10749 so the bulls are fighting back.

Note Added 1:17 PM: The comeback continues. SPX 2053. VIX down to 15.32 providing the bull fuel as it drops in this short time frame but overall it remains bearish above 14.43. Bears are okay as long as VIX stays above 14.43. The bears will be crushed by the bulls and begin a rally higher if VIX drops under 14.43.

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