Sunday, November 20, 2016

SPX S&P 500 1-Hour Chart; 200 EMA Cross

The SPX meanders along with the non-stop support of global central bankers. The Trump election win creates more stock market upside with the RUT (Russell 2000 small caps), INDU and DJI (Dow Jones Industrials) and COMPQ (Nasdaq Composite) printing new all-time record highs and the S&P 500 is only a whisker away. The all-time record high for SPX is 2193.81 and all-time closing high is 2190.15 from 8/15/16 (green circle). The SPX begins the new week at 2182. The SPX HOD on Friday is 2189.89 only 26 pennies from a potential new record closing high but the bulls could not find that quarter under the Fed's couch cushions.

Keystone highlighted the 2-hour chart last week explaining the price development and looking for the top. Price receives the start of a spankdown from the rising wedge, overbot conditions and neggie d that was highlighted. The 1-hour chart had the same set-up as shown above. Price violated the upper band and moved back to the middle band. The lower band at 2173 remains in play. The indicators are weak and bleak hinting at lower lows desired in the one-hour time frame sans the RSI. The RSI is flat as price prints matching lows so this may create an hour's worth of buoyancy before price slumps again. The stochastics slip sub 50 to 48, in bear territory. Watch to see if the RSI prints sub 50, or not.

The 200 EMA is at 2150 and is a key short-term trading indicator. The bulls rule above the 2150. When the bullish cross occurred on 11/8/16, as people voted that day for the next POTUS, you knew that a rally was at hand. The SPX back kissed the 200 EMA on 11/9/16 and never looked back sailing higher. On that bounce, you knew up was the direction ahead for stocks. Market bears have no true power until they move price under the 200 EMA which will be in the 2150-2154 area this week.

The bears should have some more downside energy available in the one-hour and two-hour time frames which hints at a soggy Monday and perhaps soggy Tuesday. As always, if the central bankers or others profess happy news, stocks will instead bounce. 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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