Thursday, December 15, 2016

SPX S&P 500 30-Minute Chart; 8/34 MA Cross; H&S

The 8/34 MA cross on the 30-minute chart is a great VST indicator for market direction. On 12/5/16, the bulls were off to the races with the positive cross (green circle). The bears were slapped around until Wednesday when the negative cross occurs (red circle) crowning the market bears victorious for the very short term ahead. As has been typically happening, the bears barely have a chance to pop the cork on the wine bottle to celebrate before the 8 MA pulls a U-turn, comes back up, and reestablishes the positive cross with the 8 MA above the 34 MA rewarding the bulls.

This started to happen today with the 8 MA curling back up but look how it takes a hook downward again. The bears rejoice and pop the corks quickly swigging down wine before they are slapped again. As long as price remains under the 8 MA it will drag the 8 MA lower and guarantee a continuing negative 8/34 MA cross and bearish path ahead for stocks.

If price moves above the 8 MA, then the bulls are fighting back and will curl the 8 MA upward again. So the bears have the upper hand with the negative 8/34 MA cross. The red lines show a potential H&S (head and shoulders) pattern in play. The neck line at 2254 and head at 2278 yield a difference of 24 points. Thus, the downside target, if the 2254 level fails, is 2230.

Keep an eye on that 2252-2256 support level. Price will either bounce or die when challenging this zone. The SPX is currently at 2261 as this message is typed with 90 minutes remaining in the Thursday session. HOD is 2272.12. All-time high is 2277.53. All-time closing high is 2271.72. 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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