SPX S&P 500 2-Hour Chart; Overbot; Rising Wedge; Negative Divergence; Upper Band Violation

Here is an update of the SPX 2-hour chart from the weekend. The idea was to wait for neggie d to form for all indicators which would likely take the stock market into Monday afternoon, which it did. The catalyst (for bulls) was Tuesday with Jerome Powell having his coming out party. Stocks are up over 80% of the time into Fed meetings and Fed events. The bulls kept stocks buoyant into the confirmation hearing and then the Powell Rally took over sending stocks wildly higher. The SPX popped 30 handles in only about 7 or 8 hours. Always remember, the central bankers are the market. That is why they are always mentioned as a caveat.

Since the Fed pops stocks again the chart has to reset with its negative divergence which will mark the top. Remember, the CPC and CPCE put/call ratios printed uber low numbers and want to see a near term market top. The chart shows universal neggie across all indicators (red lines) except for the pesky MACD line. So you should know the drill by now; the top is not in until the MACD line goes  neggie d.

The stochastics and RSI are overbot and want a pullback. The MACD line is up in nosebleed territory. The red rising wedge is bearish. Price has violated the upper standard deviation band so the middle band at 2612 and rising is on the table as well as the lower band at 2585. Price is extended above the moving averages requiring a mean reversion lower.

So bears are champing at the bit for their turn at bat which should be very near. The MACD has to go neggie d to open the downside door. Thus, price should drift lower,then recover again for another matching or higher high. When that occurs, check to see if the MACD has gone neggie d. If so, the top is in. If the MACD continues sloping higher, then a couple more candlesticks would be needed to set the MACD up with neggie d.

It looks like a couple of candlesticks should set up the MACD neggie d. If bullish, you want to see the RSI inch higher, even a sliver of strength, since that will keep the upside game going another couple of candlesticks. The bears are close. The top should be in say anytime over the next 4 hours so that would be today. The MACD line will tell you when.

Keybot the Quant algo remains long with the robot tracking volatility, copper and chips as the main drivers of market direction currently. 

As this message is typed, the S&P 500 prints a new all-time record high at 2640.14 the highest number in stock market history. The majority of market participants and watchers do not realize that they are living through historic stock market action in real-time that will be talked about for decades to come. 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.