Hello traders and investors! Let’s see how the SPX is doing today!
As we discussed in our last study, SPX is in a bull trend, and we have no convincing reversal sign around. Honestly, I overestimated the bears and thought they would make the index retest the 4,119, but they couldn’t even do that.
But how about now? The main challenge SPX has is the purple trendline in the 1h chart. Although we are doing higher lows, we still don’t have a clear higher high, and the purple trend line along with the blue line at 4,187 are two important resistances for the index.
The SPX must break these resistances in order to retest the ATH again, but what if it fails in doing that? I believe the daily chart may offer us more clues about it:
The 21 ema is pointing up, and we have a support level at 4,119, which wasn’t retested yet. If SPX fails in resuming its bull trend, we could see a congestion that could last for several weeks, and if it loses the black line, the purple trend and/or the red line will be the next targets to work with.
But so far, we must wait for confirmation, and not jump into any conclusion. I’ve seen more people losing money trying to predict the top, than when the market crashes. And even if it corrects to the red line again, this point is quite close to the 21 ema in the weekly chart:
So, a sharp correction wouldn’t be the end of the world, and the major trend would still be bullish. Therefore, let’s be careful here! And remember to follow me to keep in touch with my daily studies, and if you liked this idea, please, support it!
I must be color blind, because I cannot find that red line. :)
Nathan_Black
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@BlkGold, it is incredible but the black line near the purple trend line in the daily chart is red to me. I made it red. This is the second time I see this happening.
Tradingview is a good platform. It is not great because of glitches like this.
At least you were paying attention, and for this I praise you. 👍
Take care!
BlkGold
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The bears did come back for the retest of 4119 that you were expecting, but it turned out to be a pretty feeble effort.
TWTR_TraderChris
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If I look at the 1W chart with 10ema, to me, SPX looks to be in consolidation for the coming week or even another week after before it would get closer to 10ema. So likely no breakout for at least another week or more. Thoughts?
Nathan_Black
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@farmerchris58, I think a consolidation for two more weeks would be nice!
TWTR_TraderChris
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@Nathan_Black, yeah ... SPX up this week, but the gap between it & 10ema narrows; same for NDX. So my belief is over next couple weeks, the market remains choppy.