SPX: Key Points we must keep in mind!
Hello traders and investors! Let’s see how SPX is doing today!
The volatility increased a lot recently, and this led to a false breakout from the support level at 3827, which is a Key Point that worked as support and resistance in the past, as evidenced by the black line. Also, the previous Gap area worked as a nice support as well.
Since the index is trapped between this black line and the ATH (green line at 3861), and the 21 ema is flat, we can say that we have a Congestion, and the SPX must break free from it, in order to either resume the bull trend, or collapse to lower levels.
The daily chart may give us more clues:
Yep, the 3827 is the Jan 8 All Time High, and it seems it is working as a support now. Not a surprise, as it is just following the Principle of Polarity of the Technical Analysis.
Today’s candlestick is quite impressive, so far, as we have a huge shadow under the candlestick’s body, indicating that the bull trend is still here, and we won’t see it changing until a clear reversal occurs (Dow Theory, 6th tenet).
If the index loses again the 3827 (and closes under it), then the SPX could drop again to the Purple Trendline, and this wouldn’t be enough to change the bullish bias. The index didn’t even retest the 21 ema yet, so the trend is very bullish, indeed.
As long as we don’t see a clear reversal sign, the index will just continue to climb. And if you like this analysis, remember to follow me to keep in touch with my daily studies, and please, support this idea! Check my latest analyses on the links below.
Thank you very much!
The volatility increased a lot recently, and this led to a false breakout from the support level at 3827, which is a Key Point that worked as support and resistance in the past, as evidenced by the black line. Also, the previous Gap area worked as a nice support as well.
Since the index is trapped between this black line and the ATH (green line at 3861), and the 21 ema is flat, we can say that we have a Congestion, and the SPX must break free from it, in order to either resume the bull trend, or collapse to lower levels.
The daily chart may give us more clues:
Yep, the 3827 is the Jan 8 All Time High, and it seems it is working as a support now. Not a surprise, as it is just following the Principle of Polarity of the Technical Analysis.
Today’s candlestick is quite impressive, so far, as we have a huge shadow under the candlestick’s body, indicating that the bull trend is still here, and we won’t see it changing until a clear reversal occurs (Dow Theory, 6th tenet).
If the index loses again the 3827 (and closes under it), then the SPX could drop again to the Purple Trendline, and this wouldn’t be enough to change the bullish bias. The index didn’t even retest the 21 ema yet, so the trend is very bullish, indeed.
As long as we don’t see a clear reversal sign, the index will just continue to climb. And if you like this analysis, remember to follow me to keep in touch with my daily studies, and please, support this idea! Check my latest analyses on the links below.
Thank you very much!
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