SPX Daily Chart Six-Month Channels Overbot Rising Wedge Negative Divergence Golden Cross

Price is moving thru the top rails of the red and blue channels. A test of the top rail typically results in price pulling back for a rest as the six-month channels display. The green lines show the long and strong profile in place as the October rally ended, forecasting a need to see a higher high in price at some point forward. The negative divergence (red lines for MACD histo and stochastics) created the November spank down. In 2012, SPX receives that higher high in price that was desired but it comes with overbot conditions, a rising wedge and negative divergence shown by the red lines on the right hand side of the chart.

A move to 1333 would not be a suprise but this will only serve to officially lock in negative divergence and seal the move down. As price comes off the top watch the price movement in relation to the top rails and also the 20-day MA now at 1303 and rising. Price falling thru the 20 MA is very bearish. The Golden Cross is shown on the right hand side where the 50 MA has now crossed back above the 200 MA but as Keystone has previously mentioned, do not pay attention to it in relation to trading. If anything, the initial poke up thru typically corresponds to a short-term pull back in price.

The flat to negative-sloping 200-day MA does nothing to restore confidence, this is a bearish indication. Projection is that price is coming off the top currently, the 1333 would not be a surprise to see again, but lower prices are projected for the days and weeks ahead. 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.