SPX 30-Minute Chart with 8 MA and 34 MA Cross Upward-Sloping Channel Negative Divergence

Here's one of Keystone's fave charts to watch, each candle represents 30 minutes of trading. Remember the sideways symmetrical triangle we watched develop in mid April, resulting in failure on 4/23/12? That was the Bradley turn date as well so it looked like a big market push south was on the way, but it quickly reversed.  The black lines show that price did not bounce due to positive divergence, since price never made a lower low as compared to 4/10/12. In fact, the MACD histogram printed a lower low (red line) and wants to see price come back down for another test of 1360-ish.

So price moved higher from the 4/23/12 bottom up thru the channel shown for the last seven days. Note that price topped yesterday at the top rail of the channel, where overbot conditions and negative divergence (red lines) caused the smack down (red arrow).

The 8 MA and 34 MA cross tells you if the markets are in a short term bull move or short term bear move.  Last Wednesday, 4/25/12, the 8 MA exploded upwards thru the 34 MA announcing bull fun ahead.  Look at the push and pull this week.  The 8 MA fell under the 34 MA on Friday resulting in bearish cheers but yesterday, May Day, the bulls pushed the 8 back above the 34 throwing confetti along the way.  Note how the 8 MA is now curled over hinting that this moving aveage is about to move lower. SPX price is now down thru the 8 MA which favors bears.  Note that price may test the bottom rail of the channel at 1401-1402. This test may occur at the opening bell. Also note how the bottoms in price occur as the 8 MA comes down to kiss the price failure. Thus, price may continue to drop until the 8 MA catches up to create a bottom.  Of course if the 8 MA drops down thru the 34 MA today the bears will be throwing confetti.

On Friday, 4/30/12, note that price was flattening and the MACD histogram was the only indicator friendly towards a bounce occurring, which did occur yesterday. The other indicators for 4/30/12 hint that they would like to see price come down to test the 1395-ish level again. Watch the red circles in the right margin to see if the indicators drop under the 50% levels or zero level for the MACD. The money flow is already under 50 favoring bears. After the open, focus on the 8 and 34 MA cross and the test of the bottom rail of the channel at 1401-1402. Failure of the lower channel rail will lead to the test of the 1395-ish level.  This information is for educational and entertainment purposes only.  Do not invest based on anything you view or read here.  Consult your financial advisor before making any investment decision.

Note Added 5/2/12 at 11:46 AM:  The 8 MA stabbed down thru the 34 MA favoring bears moving forward.