SPX S&P 500 2-Hour Chart; Oversold; Falling Wedge; Positive Divergence; Lower Band Violation

Keystone mentioned the SPX 2-hour chart late Friday during the bloodbath. The chart above was setting up with positive divergence and looked good for Monday but the session plays out with lots of sideways choppy slop. More negative trade news creates market sogginess. The new moon peaked at 6 AM EST yesterday and stocks are typically weak moving through the new moon each month another contributor to a lackluster session.

The 2-hour chart above is bull candy. The RSI and stochstics are oversold agreeable to a bounce. The falling green wedge is a bullish pattern and prices typically retrace the wedges. The green lines show positive divergence across all chart indicators. The rocket ship is on the launch pad and all fueled up. Price violated the lower band so the middle band at 2779, and dropping, is on the table. The possie d should launch the SPX higher and S&P futures are up +10 about 90 minutes before the Tuesday, 6/4/19, opening bell.

Despite the joy with the 2-hour time frame above, the daily chart still wants to see a lower low. Ditto the weekly. So there is likely lots of chop on tap. The 2-hour chart should bounce price for a day or two barring any negative news bites. The daily chart may then re-manifest itself and send price lower again for another lower low. The SPX daily chart, like the prior NDX chart, appears more conducive to bottoming 2 to 5 days ahead. That should create a several day rally and recovery say during the back half of June. This would jive with perceived optimism ahead of the G20 Summit when President's Trump and XI will negotiate a potential trade deal.

The weekly chart is weak and wants to see lower lows in that time frame so G20 may be a bust, and negativity comes into strong play, say, from July forward. 92% of market participants expect the Federal Reserve to cut rates by September. Expectations for Fed rate cuts are pulled forward and at least one cut is expected this year.

If the Fed does not provide the cut/s, the stock market will be unhappy. If the Fed does cut rates, it proves that they are simply news-reactive puppets, blowing in the wind, responding to market events, and not in any control. Once confidence is lost in the Fed and other corrupt global central bankers, it's over; all is lost. We are likely witnessing the final years of America's crony capitalism system.

Traders expect a rate cut in the July-September period which may spook the Fed. If Chairman Powell tries to dial back rate cut expectations and turn more hawkish, this once-again flip-flopping stance by the Federal Reserve will tank the stock market. 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 8:04 AM EST:  S&P futures are up +17. VIX 18.27. The key VIX 200-day MA is at 17.01 so bears are in full control of the stock market going forward unless the bulls can push the VIX below 17.01. When the VIX goes sub 17, that will probably be in conjunction with the daily chart bottoming in the days ahead and then rallying in mid to late June. Bulls have zero hope going forward unless they push the VIX below 17.

Note Added Wednesday Morning, 6/5/19, at 6 AM EST:  The bulls came to play yesterday enjoying the bull candy chart above sending stocks euphorically higher. The SPX gains 59 huge points, +2.1%, to 2803. The Dow Industrials climb 650 points intraday. The bears are running for their lives. The H&S neckline is back tested. Fed Chairman Powell promises easy money forever so the stock market catapults higher and America's wealthy class dances with glee. The VIX ends at 16.97; how do you like that? The VIX is trading for about 3 hours this morning thus far and teased toward the 200-day MA at 17.02 but retreats down to 16.70 sending S&P futures up +17.