S&P in Digestion Period

the big picture remains the same. There is a consolidation near the trend channel moving average, which represents digestion period. S&P could signal a downward trajectory, depending on how it closes tomorrow. A close below 2650 on a weekly basis would see an unwelcome pickup in downside volatility and bring the early February lows back into view

Bears will have Benefits of the Doubts

the market dances its way into an increasingly tight trading range as traders wondered whether more gain is warranted given the massive rally over the past week. While the short-term technical background remains positive, the manic nature of the market recently suggests that unless there is a significant improve in the background fundamentals, the bears will have the benefits of the doubts

Expect Increase in Near-term Volatility as Market Works off Excessive Optimism

short-term momentums are deteriorating as S&P tested and failed at the trend channel moving average. A failure to hold above key price level means that long-term buying pressure has finally been exhausted. The index developed a high volatility with fast up and down moves between 2530 and 2750. While there is a low probability of a sustain break below 2530, we expect increase in near-term volatility as markets work off excessive optimism

S&P Oversold Relief Rally Might Have Run Its Course

currently rally is testing resistance at the trend channel moving average. Friday’s bearish shooting star candlestick pattern suggesting that the oversold relief rally might have run its course. Right now, follow-through is the key. We’d turn particular bearish if the S&P closes twice below 2725. A break below that level has a measured move to 2650-2540.

S&P Confirmed W-shape Pattern Formation

the W-shape pattern on the S&P is starting to look very promising after Thursday’s bullish breakout. Right now follow through is the key. Over the next few days, we will be looking for a second close above 2723 as a confirmation to the breakout signal. That, if and when happens, could trigger acceleration toward the early 2018 highs.

S&P to test Support turned Resistance

this week recovery rally pushed the S&P up against key ‘support turned resistance’ near 2720. This resistance zone is too big and too important to fall quickly, traders should not be surprised to see some backing and fillings over the next few days. Nevertheless, the longer the index stay below that level, the more vulnerable it is to lower prices.

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