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

One of Keystone's favorite VST (very short term) indicators is the 200 EMA cross on the SPX 60-minute chart. The 200 is at 2878-2879 which dictates whether the stock market is in a bullish or bearish pattern for the hours and days ahead; currently, price is at 2860 below the 200 EMA so a bearish pattern is in play. The 200 failed on 5/7/19 nine trading days ago (red circle).

With the SPX below the 200 for almost 2 weeks, the expectation would be for a far weaker stock market. Investors, however, are holding out hope for a US-China trade deal and remain generally relaxed about the stock market since the Federal Reserve, PBOC, BOJ, ECB and other central bankers plan to print money indefinitely to pump equities higher and further reward the wealthy class.

Interestingly, Keybot the Quant flipped positions twice over the last couple weeks at that 2878 level; therefore, this 2878 number carries clout. Bears win going forward if they keep the S&P 500 below 2878. Bulls win above 2878.

The 2858-2859 level is strong support. If 2858 fails, price will likely seek 2820 and 2805-ish. If the bulls push up through 2878-2879, the algo's will like that and trigger automatic buy programs. The 2890 would likely come next, then 2897-ish, then 2912.

Thus, bulls win bigtime above 2879. Bulls and bears battle for control at 2859-2878. Bears win bigtime below 2858. The new week begins at 2860.

Last week, the typical OpEx Tuesday buoyancy kicked in for stocks. Markets were a bit wild on Friday due to OpEx. The full moon peaked yesterday at 5:11 PM EST. Stocks are usually bullish moving through the full moon each month so the bulls have a very slight wind at their backs for Monday morning.

US markets are closed on Monday, 5/27/19, for Memorial Day holiday, and stocks are typically bullish the two days in front of a three-day holiday, so this coming Thursday and Friday may see buoyancy in the stock market. So weaving a market story solely based on seasonality factors, stocks may show buoyancy to begin the week but then favor the bears (as long as the SPX remains below 2878) mid-week say Tuesday and Wednesday, perhaps into Thursday morning, and then float higher into the long holiday weekend. Of course, any news on trade or from President Trump, or the central bankers, will dominate the stock market. The FOMC releases minutes on Wednesday afternoon which may be a market mover (pivot point). 

That SPX 2878-2879 level above tells you everything about stock market direction for the hours and 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.