SPX S&P 500 60-Minute Chart 200 EMA Cross Fibonacci Retracements

There is lots going on in the 60-minute spaghetti chart above especially useful and of interest to technicians. The CPC and CPCE put/call ratios remain low indicating ongoing market complacency but the central bankers keep finding a way to create buoyancy. The weak Chinese data last Friday leads to speculation that the PBOC will print more money to goose stocks higher and the last couple days are all about the Fed that is perceived dovishly willing to provide easy money accomodation as far as the eye can see (which creates a lift in stocks).

There is also likely buoyancy in the stock market attributable to Hillary Clinton's lead in the polls over Donald Trump in the race for the Whitehouse. Clinton is in Wall Street's back pocket. She receives exorbitant speaking fees from the large money center banks for showing up at token luncheons. Wall Street knows Clinton will perform their bidding but are a bit unsure about the orange-headed showman Trump. So Clinton's lead is friendly to stocks.

The red lines show the rising wedge, overbot conditions and negative divergence across all indicators which creates the neggie d spank down (red arrow). The blue lines show the Fibonacci retracement levels after the rally from early August at 2150 to Monday at 2193. Price was hung up early yesterday at the 50% Fib at 2171, but the bears were successful in piercing below only for an hour or two of trading, then price recovered above. Thus, the 50% Fib is holding; if it fails again price will likely seek the 62% Fib retracement at 2166 (which is also at the pink gap and the lower standard deviation line).

The pink lines show the gap up in early August from 2166 to 2168. The S&P 500 remains on an island above 2168. If price comes down to 2168 and gaps down to 2166 and lower that will be an island reversal pattern. Price may simply choose to stumble lower and fill that gap at 2166-2168. Price violated the lower standard deviation line so the middle band was on the table and price comes up to kiss the middle band at 2182-2183. The SPX will bounce or die from here either moving downwards towards the confluence level at 2165-2170, or, running higher targeting the overhead gap at 2186-2190.

The recovery move occurs with slivers of positive divergence in the indicators and from the oversold stochastics, RSI and money flow. The full moon peaked for this month about five hours ago and stocks are typically bullish, about 65% of the time, moving through the full moon. There is near-term long and strong juice in the indicators so a few hours of higher highs may be on tap. S&P futures are down -2. Looking at the 2-hour, the indicators are similar so there may be 1 to 4 hours of bouyancy in stocks hovering around the 2182-2183 level and sneaking a bit higher, however, considering the complacency in the put/calls that have not yet extracted their pound of flesh, the downside targets for the SPX hold more weight currently.

Bulls are not worried as long as they remain above the 200 EMA at 2161. If 2161 fails, the bears are in firm control and stocks will begin dropping in earnest. 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.

Note Added 5:41 AM EST Friday Morning, 8/19/16: The SPX moves higher on Thursday as the hourly charts hint and price seeks the 2186-2190 upside gap closing at 2187. The CPCE collapses to 0.54 the uber low put/call ratios continue. The complacency signals a near-term market top.