SPX S&P 500 Daily Chart; Overbot; Negative Divergence

The market bulls begin the year with new record highs. The all-time record high for the S&P 500 is 2695.89 only 4 points from 2.7K and the all-time closing high is 2695.81 both records printing today, Tuesday, 1/2/18, the first day of trading for 2018. The bulls are unstoppable. However, the chart says, 'stop'.

There is momentum on the bull side but note the new record highs come as a double-top pattern and all the indicators are in negative divergence. There is no more juice available to take price higher. That sneaky upper band is at 2708 and has to be respected. Price has not touched the 20 MA in about 6 weeks a long time and it needs to get down there to show respect.

Investors are throwing money at the market today. They must have received fat Christmas and Hanukkah holiday cards stuffed full of cash money. What great luck to have an Uncle John and an Uncle Sumner.

The RSI and stochastics are coming off overbot levels. You have to go with the neggie d on this chart so a near-term top is in place now and price should be spanked lower at least to 2667 to start. The lower band at 2626 and rising is also on the table.

If price rallies higher and starts to eye up that upper band, the index will still roll over and receive a spank down as long as the indicators do not move above the thin red lines (the indicators remain negatively diverged).

The bears never received a healthy pull back in stocks due to the uber low put/call ratios so they are still owed something. Perhaps the jobs report on Friday morning will also create drama. The chart wants to see a spankdown in the S&P 500 right now and as long as the indicators do not move above the thin red lines. The 2667 serves as an initial downside target. 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.

Note Added Wednesday Evening, 1/3/18: The bulls use the momentum to punch higher to that upper band that was sneaky and had to be respected, at 2708, and the band expanded higher to 2714 on the current chart. The SPX HOD is 2714.37 the highest number in history. The S&P 500 also prints a new all-time closing high at 2713.06. The VIX plummets to an 8-handle. The SPX tags the upper band at 2714 so the middle band at 2670 and rising is on the table. The same technical analysis remains in place for now. Perhaps the Friday morning jobs report will be a catalyst or the Bradley turn date tomorrow.