Sunday, February 8, 2015

SPX Weekly Chart

The two tops were highlighted as they occurred. The negative divergence creates the two smack down moves off the top. The SPX stumbles sideways this year and will not tip its hand up or down as yet. Last week, the candlestick prints a key reversal, a lower low than the prior week, then a higher high and closing higher, a nod to the bulls. However, the ever so slightly higher high comes with all indicators remaining weak and volume is lackluster. Last week was a robust price move but it was not particularly enthusiastic from a chart perspective. The MACD cross remains negative helping the bears.

Watch the RSI and stochastics to see if they slip into bear territory under the 50% level since this will usher in negativity. Bulls will gain traction higher if the RSI and stochastics stay above 50 and move higher. Price remains very extended above the 20 MA above the 50 MA above the 200 MA so a mean reversion is needed; perhaps another touch of the 50-week at a minimum. The chart technicals have no expectation for price to come up to print a higher all-time high. Can it print another record high? Sure it can. The multi-year rally for the SPX, however, is looking tired. The projections for the weekly chart is sideways to sideways lower going forward. 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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