SPX S&P 500 Daily Chart; Overbot; Rising Wedge; Negative Divergence Developing; Price Extended

The Federal Reserve carnival moves through town; the caliope sound is fading into the distance. The previous SPX 2-hour chart shows price topped-out. That negativity will team up with the overbot RSI and stochastics and negative divergence (red lines) on the daily chart above to spank price lower in the hourly time frame.

However, the green lines on the daily chart above show the RSI long and strong and momentum in the MACD line and money flow. This hints that one more high is needed in the daily time frame before the top is in for the daily time frame. Remember, trading is playing multi-dimensional chess where you have to balance the time frames against each other to form the path forward.

The SPX should drop in the hourly time frame starting today, and say through Friday into the weekend with the new moon peaking, but next week price will likely recover back up to the current highs to satisfy the RSI above and the ST juice in the MACD and money flow. There is not much there to drive price higher in the daily time frame but likely enough to bring her back up for another look once the pullback in the hourly time frame plays out.

Note that price is extended above the moving averages ribbon requiring a mean reversion lower. The red rising wedge is a bearish pattern. The upper band is violated so the middle band, that is also the 20-day MA at 4249 is on the table.

Thus, the pullback in the 2-hour time frame may take price down to 4341-ish tomorrow and Monday, then back up again to the current 4390-4400 maybe mid-week, then down in the daily time frame starting mid-week next week targeting 4249 as an initial downside target.

As usual, positive news, or announcements of stimulus from central bankers in the corrupt financial markets, will temporarily pump stocks higher or at least maintain buoyancy. Conversely, negative news will exacerbate the downside since stocks are set up for weakness in the ST now that the Fed circus is driving out of town. 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 7:57 PM EST: What happened? Madame Lagarde and the ECB send the euro catapulting higher tanking the US dollar sending US stocks higher. The stock market is in a melt-up and the bulls can do no wrong. Positive news appears at the right intervals to keep goosing price higher. Bring up the SPX 2-hour chart. The pump occurs due to the ECB decision so the SPX price makes a new high up at 4439. Wowza. The 2-hour chart remains neggie d except for the RSI and MACD line that are long and strong. The RSI and stochastics remain overbot. The RSI is flattish so it will easily roll over from this nosebleed position. The MACD line likely needs a jog move to line out with neggie d so the top can be placed, again. Perhaps there will not be news that saves the day when that occurs. There will be new candlesticks on the 2-hr chart at 9:30 AM EST, 10 AM, noon and 2 PM; it is the way the stockcharts programming is set up. Thus, a jog move (down-up) would place the top in the mid to late morning time frame (tomorrow (Friday) morning, say, between 10 AM and noon). Bring up the SPX daily chart. That was a rocket launch today. Keystone is bringing on index shorts and is taking it in the shorts. Ouch. Keybot the Quant remains long. The histogram, stochastics and money flow are neggie d on the daily chart but the MACD line and RSI receive a push higher requiring a jog move on the daily basis to top-out. The revised analysis after the bullish orgy today sounds a lot like the previous analysis. Stocks will top-out Friday morning, probably soggy into and through Monday, but then recover again to current highs next week, then roll over and die on the daily basis. UTIL moves above 916.25 today a big win for bulls. Watch the utilities tomorrow. Copper rallied helping the bull case. Mr Softy is at a record high. Everything's Coming Up Roses as Ethel sings. What do you think? Maybe bad stuff overnight and a Black Friday tomorrow?

Note Added Friday Evening, 6/16/23, at 7:30 PM EST: The major indexes all topped-out minutes after the opening bell this morning. The SPX receives the start of the neggie d spankdown on the 2-hour chart tagging the HOD at 4448, then falling on its sword, down to 4410 at the closing bell. LOD 4407. Now we see if the bears got legs. Winners and Losers, Heaven and Hell, which one did you live today? The new moon peaks this weekend the darkest time of the month. Stocks are typically weak through the new moon. There will likely be increased activity in the Ukraine War over the coming days since the Ukraine troops are loaded for bear with night vision technology ready to rout out the Ruskies in the pitch-black darkness (they were likely waiting for the new moon). The bears finally get a chance at steering the stock market ship. The stock market will be closed on Monday for Juneteenth. That holiday came out of left field many probably do not even know the markets are closed on Monday. Keystone is a white dude but he has been retired for many years so you can say he is free from slavery also. There was no Black Friday. What do you think? Maybe a Black Tuesday?