SPX 30-Minute 8 MA and 34 MA Cross Indicator
Looks like the bears may have the Charlie Brown football pulled out from under them again today. The 8 MA is coming down to stab thru the 34 MA to place the bears in charge, however, the futures are up, oil is up, copper is up, yields are up, so price wants to jump to 1500 to start the day. With a price spike, the 8 MA will stop its downward slide and reverse back to the upside saving the day once again, keeping the bulls in charge for the hours and days ahead if the 8 stays above the 34. When price comes back up watch to see if negative divergence is placed (red dots and thin red lines), or not. Negative divergence will create another spank down. The bulls have been in charge for six days when the 8 MA won the fierce sideways 8/34 MA battle back then. The indicators were in overbot territory signaling negative divergence three times as price climbs, all of them resulting in the expected smack down, but the bears simply do not have any juice. The bulls are buying dips and now that strategy is replaced with buy anything. Usually more substantive downside would be expected from the negative divergence.
The upward-sloping channel is in play with price poking up thru the top rail yesterday so watch to see if price remains inside which would mean price staying under 1500-1501 (not including a spike which may tag 1505). Key S/R levels are 1505, 1496, 1489, 1485 and 1476. A break up thru 1505 places the 1520's on the table. Traders typically pare back shorts on Friday afternoon creating bullishness, however, with a price spike this morning, and if the negative divergence is placed again, the afternoon could set up for a reversal and perhaps the bears will try to run the 8 MA down thru the 34 MA before the weekend. Bears got nothing unless they move the 8 under the 34. 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.
Dear KS,
ReplyDeletei have one theory an i will expose it to you: this rude FED interventionism in markets prepares the stocks foe even one more flash crash.
How come?
Let's see: in a normal market where powerful forces like FED don't mess up the bears and the bulls keep the equilibrium - bidders and askers.
In such moments of terrific short squizing no one wants to be a bear anymore. Layers after layers of bears are eliminated (CPC down, VIX down , and so on).
But FED cannot control (i hope :D!) events outside financial markets (natural disasters, as exemple) .... When such an dreadful event appears everyone from the stocks party will rumble to the doors at the same time.
And than more money to keep the markets calm will be necessary.
It's a vicious circle. FED is in a more vicious circle than BOJ 20 years ago.
If I , from a marginal country in Europe, can understand that , how come the almighty thinkers of FED don't understand that ?
V.
They all understand things. Political leaders likely realize that can-kicking is the way to go since it all ends in world war and all these daily economic machinations will disappear into the air, all of us would have far greater worries at that point.
ReplyDeleteInterestingly, the shorts are squeezed out now, there are only buyers remaining, shorts have given up since it is too difficult to fight the Fed, an interesting time since it hints that air is under the markets currently.
''Interestingly, the shorts are squeezed out now, there are only buyers remaining, shorts have given up since it is too difficult to fight the Fed, an interesting time since it hints that air is under the markets currently.''
Deleteyes, you've got that point!
in the bloggers area almost all blogers that traditionally were bears/permabears now are just licking the wounds of their portfolios are form time to time are yelling : "don't fight the fed" , " 1700 spx 500 in the summer of 2013" and stuff like that....
the best and spectacular moves are when you first load all the little retailers in one single boat and after that you just sink the boat :D .... cruel, I know. :)
I know one more thing: although it's not gonna be a straight line in order to try to make a new all-time high record on spx 500, we're gonna get there. (not now, maybe in June 2013). The volume of retailers from a certain point might increase (starting from popular beliefs :"look, it's rising, the stocks are rising, let's buy") and the price might enter in the 1600+ area on spx 500 ... I won't be in the market at that point for sure! (no longs, no shorts) until market will change it's mind.
One more thing :D ...a funny one.
Last night i've dreamed that during 6 and 14 Feb'13 the markets crumbled '87 style.... just curious if this thing will happen' :)
With 2 or 3 exceptions it happened to me in the past to dream things that after that occured. Take it as a joke, don't even bother to think about it seriously! But i'm still curious :) ....
V.