Sunday, July 5, 2015

SPX S&P 500 Daily Chart Moving Average Ribbon Downward-Sloping Channel

The breakdown from the red rising wedge pattern, an ominous bearish pattern, continues. Price back tested the lower red trend line three times (red circles), and failed so the bears cheer. The green downward-sloping channel is in play. The red lines show the negative divergence occurring as price made new highs so the spank down occurs. The three green lines show positive divergence as price came down to the 150-day MA, hence a bounce occurred due to this positive energy. The MACD line remains weak and bleak wanting to see a lower low with price going forward but obviously the Greece drama will dictate the market action to begin the week. The brown sideways channel at 2065-2130 (only 65-handle range) continues for the last five months.

The results of the Greece referendum vote should be available starting 9 PM local Athens time (7 PM London time; 2 PM EST Sunday afternoon on the East Coast) and obviously the results will send markets one way or the other so the week begins with a coin flip.

Note how price obeys the support/resistance at the 100, 150 and 200-day MA's. The 200-day MA at 2055 has held so it would be serious trouble if it failed going forward. The 150-day MA at 2079. Keep everything simple and ignore all noise in the markets; very simply, if the SPX moves above 2079 (150-day MA) and higher the  bulls win big. If the SPX stays under 2079 (150-day MA) and moves lower, the bears celebrate.

In addition, the slope of the 150-day MA's are very key for telling you if your stock or the indexes are in a cyclical bull or bear pattern. Note how the 150-day MA line is flattening threatening to roll over. If the slope of the 150-day MA rolls over to the downside the stock market is in serious trouble. If the bulls right the ship and the 150-day MA line turns higher again, it will be party time for bulls. The 150-day MA on the INDU (Dow Industrials) is flat and threatening to roll over (same as SPX), the COMPQ (Nasdaq Composite) continues higher and the Russell 2000 small caps (RUT) is flat threatening to roll over. Use these 150-day MA slopes as a key forecasting tool 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.

No comments:

Post a Comment

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