Saturday, April 25, 2015

SPX 1-Hour Chart 200 EMA Cross Overbot Rising Wedge Negative Divergence

The bears were in good shape last weekend with the SPX under the critical 200 EMA signaling bearish markets for the hours and days ahead, however, the Chinese cut the bank triple R rates to goose the stock market and the bears were punched in the face to begin last week's trading on 4/20/15. The central bankers are the market. The SPX is above the 200 EMA on the 60-minute chart at 2091.44 signaling bullish markets for the hours and days ahead.

The red lines, however, indicate negative divergence across all indicators and the stochastics are overbot both wanting price to selloff. The CPC is down to 0.76 signaling uber complacent markets so a market top is at hand. The prior SPX 2-hour chart leaves the door open for a couple more hours of upside so if that occurs the purple path should play out with price printing once more in the apex of the rising wedge before rolling over. The blue path is the scenario where price simply begins selling off from here.

Watch the MACD cross, currently positive favoring bulls. If the MACD cross turns negative you will know that the bears are driving the bus going forward. As markets selloff, the bears got nothing unless they push price under the 200 EMA at 2091. When price approaches 2091 a critical bounce or die decision will occur determining the fate of markets 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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