SPX Daily Chart Descending Triangles

A look at the SPX daily chart shows a couple descending triangles in play. Price is weakening as the RSI, stochastics and money flow are all under their 50% levels, and price is also under the 20 MA which is under the 50 MA. All this is bearish. The blue descending triangle can still take another 7 or 8 weeks to work itself out, or it may fail the baseline at 1120 at any time. If the baseline fails, the blue triangle targets the distance of the vertical side of the triangle, which is about 140 points, thus, 1120-140=980 target.

The steeper red descending triangle is a faster path south, the triangle will resolve within 2 or 3 weeks, and the target, should the base line fail, is 1360-1120=240; thus, 1120-240=880 target. The red triangle is more reflective of a waterfall crash event which is lower probability in a tight time frame, but something to be aware of nonetheless. If the 8/9/11 intraday low of 1101 fails, the 980 to 1000 area is not far off.

For the bulls, you need to regain the 50% levels on any of the indicators and at least that would provide hints of upside relief on tap, then price would need to regain the 20 MA to nullify the triangles. Projection is sideways to sideways down moving forward with the 1120 level failing at some point forward.  Note that even a move back up to 1190 keeps the blue descending triangle in play. If the SPX moves above 1200 the triangle patterns will be nullified. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here or any links connected to this information. Consult your financial advisor before making any investment decision.