SPX Daily Chart Rising Wedge Overbot Negative Divergence Upward-Sloping Channel

The green falling wedge, oversold conditions and positive divergence bounced price in June just as the red rising wedge, overbot conditions and negative divergence will now spank price downwards. Price is at the top rail of the upward-sloping channel, also a logical point for a reversal.  The neon squares show how the Draghi announcement to support the euro by all means necessary resulted in a large market thrust higher; markets move with the euro.  But, when Draghi provided the bazooka bond-buying program, another big thrust for the markets, the volume is falling. The further flat to higher prices, yesterday printing another intraday high for the year, results in more volume weakness. This is not the sign of a healthy, long-term sustainable upside rally.

Since the Fed is on tap in less than four hours, all bets are off, Chairman Bernanke will decide the fate of the markets.  A print up inside the rising wedge which would be another touch of the top rail cannoit be ruled out if the Fed provides a bazooka today, but overall, the chart is sick, and the downside projections shown by the red dots are in order.  Critical support below includes 1429, 1427, 1419, 1406 and 1403.  The 20-day adn 50-day MA's will likely become important support levels for the SPX in the days 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.