SPX 30-Minute Chart 8 MA and 34 MA Cross

The price spank down occurred yesterday as was easily forecasted by the red rising wedge and negative divergence discussed on the weekend.  The bears could not muster up any downside momo, however.  Note the tight 2 1/2 day range thru the 1466-1472 channel.  The 1468 and 1472 strong S/R levels are key.  In general, bulls win above 1472, bears win below 1466-1468. The negative divergence from one day ago was universal across all indicators and once price receives a smack down from this posture, price does not need to come up again for a matching high, it is expected to travel lower.  But yesterday, on the DELL buyout news, and more importantly buoyant oil and commodities, the SPX recovered. Note the candle highs in the afternoon teasing 1472 so price did come back up to check the prior high anyways, and the negative divergence remains in place. Interestingly, the last three candlesticks are a doji, an inverted hammer and a hanging man, all three signal a potential trend change which would need to be verified after the opening bell.

The drama yesterday required Dramamine since the bears pushed the 8 MA under the 34 MA to signal victory, then the bulls pushed the 8 back above the 34, then a short time later bears pushed it under, then the bulls again and the day ends with the 8 MA above the 34 MA signaling bullish markets for the hours and days ahead. The 8 and 34 MA cross will tell you everything you need to know about market direction today. And the cross will be dictated by oil, copper, commodities and the retail sales data. Bulls win if the 8 MA stays above the 34 MA.  Bears win if the 8 MA falls under the 34 MA. Watch the cross after the opening bell. 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.