- WE'RE JUST RANDOM SPECKS OF DUST IN A TORNADO TO THE MARKETS .......
- CHARTISTS MUST PUT ALL BIAS ASIDE AND LET THE CHARTS DO THE TALKING OR WE'LL SEE ONLY WHAT WE WANT TO SEE
- This blog has a copy of all header posts that I publish anywhere, so that those interested in seeing what my thoughts are on the markets can find them easily.
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- The charts in the posts are as large as I can practically make them. if you would like to look at one more closely, click on it, and the link will take you to a larger version at screencast. If you click on that again, you will get a full page version, and can use the resizing function on your browser to enlarge parts of interest further.

Friday, 19 July 2019

Daily Sell Signals Have Fixed

The daily RSI 5 / NYMO sell signal that was brewing last week has fixed on this first decline from the all time high and has not yet reached target. The rising wedge has broken down into a test of the daily middle band so far, and I am looking for a reversal pattern to form. The obvious options are either to retest the all time high to make the second high of a small double top or to head further down towards the 2964 area and the possible H&S neckline there.

SPX daily chart:
I was talking on our free public 'favorite setups' webinar last night about the importance of the 50 hour MA on SPX, and that was resistance on SPX at the high yesterday, and while that was broken slightly at the highs today, that was not converted back to support and has rejected late in the day. The obvious next target for me is another test of the daily middle band, now at 2973, and a likely break down towards the mid 2960 area and the possible H&S neckline support there.

SPX 60min chart:
ES broke back over the weekly pivot today but failed to convert that to support either.

ES Sep 60min:
Stan and I did a free public webinar yesterday looking at some of our favorite setups. If you missed that you can see the recording on our July Free Webinars Page. We looked at examples of charts from this week and if you watch the video you can see how the setups we looked at delivered nicely today.

Neither Stan or I spends much time talking about setups we look at in these webinars in retrospect, as we both feel that it seems like boasting, and there is already plenty of that on twitter without us pitching in. It also smacks of vanity, which can be a fatal flaw in any analyst. That said, our marketing people point out that referring back to past successes might be be better described as marketing rather than bragging, so that being the case I'll talk quickly about the two setups that I was talking about last night in the webinar, and that you can see on that recording.

The first setup was buying or selling the 50 hour MA in a backtest during the trend, and obviously you can see the reaction to the fail at the SPX 50 hour MA today. The other setup I looked at was the double bottom on CL yesterday afternoon. I was looking at that on positive RSI divergence, and noting that the double bottom target in the 56.50 area was both a strong match with a 61.8% retracement of the last leg down, and with a test of the monthly pivot at 56.46. I was saying that CL was a decent looking long into that target and an interesting short when it got there. The overnight high was at 56.49 and the subsequent low today was 55.12 so both were nice calls. We do a lot of nice calls but don't usually mention them, but my point is that the free public webinars are always worth watching IMO.

Everyone have a great weekend :-)

Wednesday, 10 July 2019

Daily Sell Signals Now Brewing

In my post last Friday I was talking about the likely retest coming of the new all time high on SPX (and ES), and how that should set possible daily RSI sell signals brewing on SPX (and ES). We saw that ATH retest and marginal new ATH this morning and I am now looking for a high. It is possible that SPX/ES might go a bit higher but I wouldn't expect much higher and I'd note that there is already a decent quality double top setup here and that on a sustained break below 2964 the double top target would be in the 2923 area.

ES Sep 60min chart:
On SPX the smaller rising wedge has broken down but it is still possible that the larger wedge resistance trendline might be a target. That is now in the 3025 area.

SPX 60min chart:
On the daily chart we now see the RSI topping configuration that I was looking for to form in my last post. Today is the middle of this high window so i am looking for a high to form. The key support level I am watching for support here is the level that held at the low yesterday, at the 50 hour MA on SPX, now in the 2971 area.

SPX daily chart:
If you missed Chart Chat on Sunday you can see the recording posted on our July Free Webinars page.

Friday, 5 July 2019

Coming Into The High Window

Apologies for the long delay between posts. My wife has been having a serious health issue including some surgery so I have been very distracted.

In my last post I was looking for another high retest, and we have seen that, with a push this week into the psychologically important 3000 area after the close on Friday. So what now? Well the next high window slipped back from late June into the middle of next week, and we are looking for a significant high, and very possibly the 2019 high, to form in this area. In the short term I'm expecting SPX to test the new ATH on ES and I have a high quality possible rising wedge trendline currently in the 3005-10 area which would be a solid match with that.

SPX 60min chart:
On the daily chart a possible daily RSI 5 sell signal is now brewing, and that high retest might well set an RSI 14 sell signal brewing as well.

SPX daily chart:
On NDX a marginal new ATH has been made and there is now a near perfect nested double top setup for what could be a very serious pullback. Again a possible daily RSI 5 sell signal is brewing.

NDX daily chart:
Stan and I are doing our monthly free public Chart Chat on Sunday, and if you'd like to attend you can register for that on our July Free Webinars page. Our annual July 4th sale is also on until the end of this week and if you are interested in picking up a discounted annual subscription you can do that here. Everyone have a great weekend :-)

Friday, 14 June 2019

Sometimes It's Just a Flag

SPX made a high early this week, broke down from a decent quality falling wedge and the obvious retracement targets were either the 38.2% or 50% retracements in either the 2840 or 2820 areas before another likely leg up.

Sometimes however any initially promising looking topping pattern evolves into a flag as the index trades gently sideways to down, and so far at least, that is what has been happening here. SPX may yet make a lower low, unless this is a triangle forming here, in which case SPX would likely test triangle support in the 2876-8 area before breaking up into a new high for June. If we are going to see a full retest of the all time high, I would expect to see that on this leg up into the next high window in the last few days of June, and then likely lower.

SPX 15min chart:
On the hourly chart the RSI 5 sell signal reached target and the RSI 14 sell signal reached the 50 level, which is often support before another higher high on price and lower high on RSI. Looking for that next.

SPX 60min chart:
On the daily chart the retracement has tested the 50dma and found support there so far. A higher high on SPX would likely set a possible RSI 5 sell signal brewing, though if that leg up reaches the retest of the all time high then this modest negative RSI 5 divergence might not survive that far.

SPX daily chart:
Everyone have a great weekend. :-)

Tuesday, 4 June 2019

The Next Inflection Points

In my post 'Important Support Breaks' on 2nd May, as SPX was starting to break down after the new all time high, I was talking about the ideal retracement target at the possible H&S neckline in the 2722 March low area. SPX bottomed out yesterday at 2728 and in practical terms that target area I gave has been hit. The low from there was decent and on the chart below I have inset the tweet I put on our (subscriber only) twitter feed just after that low calling the possible nested double bottom setup with an overall target in the 2799 area, and obviously that has been playing out since and is almost at target.

ES Jun 60min chart:
So what now? Well the two main options, assuming that SPX is now in a rally period into the next cycle high window in late June, are that either that larger H&S right shoulder forms over that period, with an ideal high area effectively at the SPX monthly pivot at 2819, or SPX makes a sustained break back up over the monthly pivot soon and then likely looks for another all time high retest. Either way, after June most likely SPX will go lower than we say yesterday.

Supporting the right shoulder scenario, the daily RSI 5 positive divergence on SPX and RUT was lost at yesterday's close, so the buy signals that fixed after the low were hourly signals rather than daily. That isn't supporting a big move higher, as most of those have already made target, though we could see that move in any case of course.

On the chart below I have drawn in the highest probability paths over the next few weeks with the key potential inflection points that I'll be watching. I am favoring the H&S right shoulder scenario as long as monthly pivot holds as resistance, and also as long as the break down from the H&S after the right shoulder forms isn't rejected hard after that break down.

SPX 60min chart:
The weekly and monthly pivots are marked on the daily chart below, on which you can see that SPX has now reached the minimum 38.2% fib retracement target from the broken rising wedge from the December low. In theory SPX could head up directly from here into sustained new highs, but that isn't the higher probability scenario in my view.

SPX daily chart:
Stan and I did our monthly free public Chart Chat on Sunday and if you'd like to see the recording that is posted on our June Free Webinars page. We run trading courses a few times a year covering swing and day trading and these are, even if I do say so myself, and as far as I can see, the cheapest and best available anywhere. We are starting our next course in a couple of weeks, and if you are interested you can see more details about that here. We run live trades as part of the course and on the last one I set up a CL trade live that on a minimum position made a minimum overall profit of $2k. I'll be digging up the details on that for a post, but the course only costs $499 for non-subscribers. Just sayin'.

I've been very busy but I'm going to be trying to do two posts a week at minimum going forward. In the short term I'm expecting to see resistance in the 2795-2820 area and we may well be chopping around in the range between yesterday's low at there for most or all of the rest of June.

Monday, 27 May 2019

Choices, Choices

One way of looking at markets is as a succession of inflection points or probability forks, at which there are generally a higher and lower probability option which, once taken, take the markets to the next in that series, either eliminating or significantly changing the paths not taken at that inflection point.

We've been looking for one of those inflection points to happen at about this time, and in about this area, and that is likely to be resolved over the coming week, so in this Memorial Day post I'll be looking at that and what the shorter and longer term implications of the direction taken from that on SPX.

Back at the end of December I wrote a post 'Goodbye To 2018' that the key resistance level to hold on any rally would be the monthly middle band, and that a monthly close back above would likely deliver a new all time high in 2019. On 15th February, after the break back over the SPX monthly middle band at the end of January I wrote another post 'It Sounds Wild But .....', where I was talking about the possibility that that all time high retest might make the second high of a large double top, and we have now obviously reached the stage where that pattern is visibly forming, though of course it doesn't need to finish forming, or indeed play out to target if it breaks down.

That said, it is a very high quality potential pattern. The target area would be close to 1800, a double fib retracement area with the 50% retracement of the bull run from the 2009 low and the 61.8% retracement of the bull run from the 2011 in the same areas. Double top support at 2346.58 is also close to the rising support trendlines from the 2009 and 2011 lows. This is a very attractive setup,and it has potential to deliver that move in the right environment, which could be delivered if the trade war news, already heading south, continues to deteriorate.

SPX monthly chart:
In the shorter term, looking at the retracement so far from the new all time highs in 2019, there is a 5dma Three Day Rule target at a full retest of the May low at 2801.43, not yet quite delivered on this last move down, though NDX and RUT have both already made lower lows. That Three Day Rule target is an exact target, though there are a couple of rare past exceptions when overall triangles have been forming, which doesn't currently appear to be the case here. I am therefore expecting to see a full retest of 2801.43 on SPX sooner rather than later in the coming week.

As and when we see that full retest, that takes us fully into the next inflection point on SPX, with possible daily RSI 5 buy signals then forming on all of SPX, NDX and RUT, and indices in the clear low window with the centre of that window seen last Friday.

SPX daily chart:
The short term setup here on SPX/ES is fully formed H&S patterns on SPX/ES with targets in the 2640/50 area. Again this is an attractive retracement target, at a 50% retracement of the move up from the December low. As a general rule we regard the inflection point options as a 70/30 probability split, so reaching that target here would be the 30% option. The more likely option on the timing cycles would be a rejection at the break below the H&S neckline, delivering ideally (for me) a retest of the all time high, in what might well be the second high of a smaller double top, or alternatively (for Stan) a consolidation below 2900 area resistance before the next leg down. If ES is going to reject back up, then that might well be after a touch of possible falling wedge support

ES Jun 60min chart:
On NDX the setup here is another H&S that has already broken down slightly, though it may be that the head has just been completed on an H&S with a flatter neckline. Either way, if the H&S delivers a sustained break down, the target would be in the 6650-6750 area, just over the 61.8% fib retracement of the move up from the December low.

NDX 60min chart:
On RUT the setup here is a double top that has already broken down slightly before this latest bounce. On a sustained break down the target would be in the 1370-90 area, significantly more than 61.8% of the move up from the December low.

RUT 60min chart:
We are regarding the odds at this inflection point as 70% to find support after a modest lower low and rally there for several weeks, and 30% that we see a sustained break down towards these pattern targets on SPX, NDX and RUT. That said, bad news may push the market down and the trade war news so far has been impressively grim, with no sign of that being likely to change over the next few weeks, and with signs that the situation may deteriorate significantly further over that period. We shall see.

A couple of announcements today. An hour after the close on Wednesday Stan and I will be doing the third webinar in our Trading Commodities - Setups And Approaches' series. If you'd like to attend you can register for that either here, or on our June Free Webinars page. We are also doing our free monthly Chart Chat on Sunday, as it is the first Sunday of the month, and if you'd like to see that you can either register for that on the same page, or directly here.

Stan and I have also launched a new metals and energies service looking at some important stocks in these areas. Those tickers are AG, GOLD, KL, MUX, SBGL, USO and UNG. If you're interested in a free trial you can see more details here: This new service and our Big Five and Sectors service are both included in a 20% Memorial Day sale lasting until the end of this week, and, as with all our discounts, that discount lasts through the lifetime of the subscription, with no price rises ever applied while any subscription is continuous.

Everyone have a great holiday! The rest of the week should be interesting.

Wednesday, 22 May 2019

Three Day Rule Target At 2800 Retest

SPX broke back over the 5dma last Thursday and that put SPX back on the Three Day Rule, which is that after a decline of more than 2% followed by a break back over the 5dma, then SPX must hold above the 5dma the next two daily closes. If SPX fails to manage that then the retracement low (2801) should be retested before the initial high before the decline (all time high). The close on the third day on Monday was a clear break back below the 5dma. That low retest would normally be soon after the break and this a very strong stat, so I am looking for that 2801 retest. 

SPX daily 5dma:
In terms of the timing of that retest there are a few things to consider. The first is that the next cycle window is close, with the middle of that window on Friday this week. That can run into the middle of next week but that is not a lot of time to make this low. Unless there is some really impressively bad news the next retracement low may not be much below 2800. We will see.

What are the support levels? Well I have possible H&S necklines in the 2785 and 2722 areas, with 2722 being my preferred option since we started this decline, though that's a long distance below unless we start seeing some serious moves to the downside. I'd note that the daily 3sd lower band is now in the 2765-70 area, so a fair match with my first support level not far below 2800, and that on a sustained break below 2800 would now fix an H&S target in the 2650 area.

Given the short time available though, I'd note that the H&S setup here is very much a two edged sword. If that SPX neckline in the 2800 area breaks down, and then SPX rallies enough to invalidate the H&S with a move over the right shoulder high at 2892.15, then there would be a strong Janus Flag target at a retest of the all time high, and we will be looking for a possible strong rally back into June, so that would be a decent fit with cycles.

To start the move down into the 2800 retest the first support level is at the weekly pivot and 50 hour MA on SPX in the 2851/2 area. A break and conversion of that to resistance opens the low retest.

SPX 60min chart:
On the daily chart I'd note that on a retest of 2800 from here, then a possible daily RSI 5 buy signal would start brewing. On the retests of the retracements lows on NDX and RUT, similar daily buy signals would likely also start brewing. SPX daily chart:
 
The remaining cycle trend days this week are today, not looking too trendy so far apart from on CL, and Friday. There is a big news day tomorrow with the Fed, and random news bombs can come at any time of course on trade war updates. The trade war news has been pretty grim over the last few days, and that being the case I'm a bit surprised that SPX isn't closer to a retest of 2801 already.

An hour after the close on Thursday 28th May Stan and I will be doing the third webinar in our Trading Commodities series. If you'd like to attend you can register for that directly here, or on our May Free Webinars page of course.

Wednesday, 15 May 2019

X Marks The (Ideal) Spot

Before the open this morning I was cautiously predicting that ES would rally today to a higher high than yesterday, ideally failing today at a high in the 2865-9 area. As it happened the low of the day was happening at the time on ES, slightly before the RTH open, and ES is now testing yesterday's high. So far, so good.

Full Premarket Video from theartofchart.net - Updates on ES, NQ, RTY, DAX, ESTX50, SPX, NDX, RUT, CL, NG, GC, SI, HG, ZB, KC, SB, CC, ZW, ZC, ZS, DX, EURUSD, USDJPY, USDCAD, AUDUSD:
The scenario I was looking at then and now was a modest higher low and then a modest higher high to form a bear flag channel into a test of declining resistance from the highs on SPX. I have tentatively marked an X on the SPX 5min chart the ideal time and level for SPX to top out today and we'll whether that delivers exactly in the next hour or so. If not there is some wiggle room. 

SPX 5min chart: 
On the hourly chart I show the overall falling megaphone forming from the high so far. Declining resistance and the 50 hour MA are effectively the same resistance area at the moment.

SPX 60min chart: 
In the event that declining resistance and the 50 hour MA are broken and converted to support, which is possible but not looking particularly likely at the moment, then resistance higher is at the daily middle band, currently 2903 area, and the monthly pivot at 2914. SPX daily chart: 
An hour after the close tomorrow Stan and I are doing our free monthly public webinar on big five and sectors, covering AAPL, AMZN, FB, GOOG, NFLX, TSLA, IBB, IYR, XLE, XLF, XLK and XRT. Given the current market action that should be pretty interesting, and if you'd like to attend you can register for that here, or on our May Free Webinars page.

Monday, 13 May 2019

The Battles Of The Band

On Thursday before I wrote my post SPX went a few handles below the daily 3sd lower band, and as I'd generally expect we saw a strong rally from there. On Friday, somewhat to my surprise SPX again went a few handles below the daily 3sd lower band, and we then saw an even stronger rally off that low. This morning, with the daily 3sd lower band currently at 2816, the current low of the day is a few handles lower and we're probably going to see another rally, though it's hard to say whether it will be as strong as the others.

Obviously the daily middle band is now turning down, and the lower it turns and the wider the bands become, the further down the daily 3sd lower band will extend, SPX could just keep riding this down.

The current level is important though. I was asked a couple of weeks ago where I would expect the retracement to go, and I gave two targets. The first target is the current area, 2800-20, marked with the purple band on the SPX hourly chart below as an established strong support/resistance level. The second and preferred target is the 2722 area, at the full retracement of the rising wedge from the March low, and the 38.25 fib retracement of the rising wedge from the December low, also a possible larger H&S neckline. Stan  ran the cycles last Thursday night with updated data and the next cycle window is a low window in two weeks. That is where I would like to see SPX at that low.

In the meantime I'm still looking for a possible wave B retracement, with the caveat that we may already have seen a very fast B wave rally on Friday. If that is not yet done I'd be looking for strong resistance at the daily middle band, now at 2909, and the monthly pivot at 2914. A break and conversion of those levels to support could trigger an ATH retest.

SPX daily chart:
On the hourly chart SPX is testing a big support zone here, and this would be an obvious level to rally from. I'd note that hourly RSI 14 buy signals fixed on all of SPX, NDX, and RUT on Friday though of course a very strong trend can overwhelm these. SPX is testing a high quality falling megaphone support trendline that may hold.

SPX 60min chart:
No current divergence on the ES 60min chart, though ES is testing trendline support here as well.

ES Jun 60min chart:
One thing I was looking at on Friday that was encouraging for a rally on equities here was the strong reversal setup on USDJPY formed on the initial break of major double top support and annual pivot test. A 60min buy signal fixed and a high quality double bottom setup formed. Obviously there is a very decent correlation between USDJPY and SPX. Overnight that long setup fell apart with a strong break below the annual pivot towards the double top target considerably lower at 106. Obviously that is not that encouraging for a strong rally, though it is encouraging for my main target in the 2722 area being reached. We will see.

USDJPY 60min chart:
Regardless of a possible stronger rally here, SPX is trading under the daily 3sd lower lower band as I write, that is strong support for today and on a daily lower band ride we would almost always see a test of the daily 2sd lower band at some point during the day. That is currently at 2846.

An hour after the close on Thursday Stan and I are doing our free monthly public webinar on big five and sectors, covering AAPL, AMZN, FB, GOOG, NFLX, TSLA, IBB, IYR, XLE, XLF, XLK and XRT. Given the current market action that should be pretty interesting, and if you'd like to attend you can register for that here, or on our May Free Webinars page.

Thursday, 9 May 2019

Taking Stock Here

Last week I was looking at support that needed to be broken at the SPX daily middle band to open further downside and obviously SPX did that and could be at or close to the wave A low here, looking then for a B wave rally, and then a C wave down into the next low window and to complete the current move. On Sunday's free public Chart Chat I was talking about a possible H&S target in the 2840 area which was reached at the lows this morning. If you missed Sunday's Chart Chat or would like to see that again, that is posted on our May Free Webinars page.

We hold a subscriber only webinar every month at which we answer any questions attendees have, and review important markets in response to those questions, and we are holding one tonight at which, this time only, all are welcome. So if you'd like to see that you can register for that on our May Free Webinars page or you can register to attend using this direct link.

So where are we up to on the SPX daily chart? Well the short term H&S target at 2840 has been reached and the daily RSI 5 sell signal has reached target. The low today was just under the 3sd daily lower band, currently at 2839, and SPX has also currently broken below the 50dma now at 2859. If the B wave has now started then the rally should respect either 2900 or the monthly pivot at 2914. A break and conversion of the monthly pivot at 2914 to support at this stage might well finish this move early and deliver another all time high retest. After the Wave B rally we would ideally see a high latest Monday, down into the next cycle low to be made middle to end of next week.

As I was saying on Chart Chat, my ideal target for that low would be at the 38.2% retracement and retest of the March low at 2722, but I also mentioned possible support in the 2800-20 area, and a possible alternate H&S neckline in the 2785 area.

SPX daily chart:
In the short term the current low is now on any hourly or daily positive divergence so while the Wave A low may be in, it is unlikely that the main retracement low is in. Any rally here should just be a rally before lower lows in the near future. We shall see. 

SPX 60min chart: 
Everyone is welcome at tonight's webinar an hour after the close. Hopefully I'll see you there

Thursday, 2 May 2019

Important Support Breaks

Since my post a week ago SPX has retested the all time high as expected and made a marginal higher high, the rising wedge from the December low has broken down, the second daily RSI 5 sell signal since the December low has fixed, the first having played out into the March low, SPX has broken important short term trend support at the 50 hour MA for the first time since March, and backtested that as resistance, and also broken the weekly pivot at 2925.

Today's Premarket Video from theartofchart.net - Updates on ES, NQ, RTY, DAX, ESTX50, SPX, NDX, RUT, CL, NG, GC, SI, HG, ZB, DX, :

So what now, as we move into the next cycle low period expected in a couple of weeks? Well the minimum fibonacci retracement target I'm looking for on the breakdown of the wedge is the 38.2% target at 2722 which, if seen, would also be an exact retest of the March low and the possible large H&S neckline there. Ideally the next low would be there, with a right shoulder bounce back into (ideally) the 2868 area into the June cycle high window, though I have an alternate possibility for the May low in the 2820 area. That is assuming of course that shorter term support at the daily middle band, tested at the low today, can be broken.

SPX daily chart:
In the short term the hourly and daily sell signals are close to played out and we could see a rally here. Ideally the 50 hour MA, now at 2930 would hold as resistance as it did at the AM high today, and SPX would continue down from there. A sustained break back over 2930 could deliver yet another high retest, which would be annoying, but might of course be needed to set up a double top to deliver the next leg down.

SPX 60min chart:
If we do see a sustained rally from the low this morning, I do have a possible ES 60min buy signal brewing to help deliver that high retest. We will see.

ES Jun 60min chart:
Stan and I are doing our monthly free public Chart Chat on Sunday looking at the usual very wide range of instruments across indices, bonds, metals, energies, currencies, cryptos and other commodities. If you'd like to attend you can register for that on our May Free Webinars page.

Wednesday, 24 April 2019

The SPX All Time High Retest

At the end of every year Stan and I do a public webinar where we look at the more likely options for price moves on indices, bonds, forex, metals, energies and other commodities over the coming year. At the one we recorded on 30th December 2018 we were asked a question as to what could invalidate the scenario that SPX was in an ongoing bear market and I gave the reply below talking about the important resistance at the monthly middle band in an ongoing market.

Excerpt from 2019 Outlook public webinar recorded 30th December 2018 looking at the SPX monthly middle band in bear markets. :
I followed that up with a post the next day on New Year's Eve (no, I don't get out much) talking more about that,  with the observation that if SPX closed a month significantly back above the monthly middle band on the rally from the low, then the odds would strongly favor a retest of the all time high before any significant lower lows. You can see that post here. I then followed this through into the close back above the monthly middle band at the end of January and since in other posts.

SPX monthly chart:
I was expecting this current swing high to be a lower high under the SPX all time high on the basis of the pattern setup and daily RSI divergences across multiple indices and while yesterday's trend up day hasn't much changed the pattern setup, it did fail the fixed daily and hourly sell signals and apart from the daily RSI 5 sell signal on ES that just survived the RSI spikes, there is now no negative divergence on the daily or hourly charts on SPX, NDX or RUT or associated futures. The odds favor needing some or all of that to be re-established, and to do that SPX will need a retracement and then a higher high, which at this stage would almost certainly require a retest of the all time high on SPX at 2940.91.

SPX daily chart:
There have been a slight modifications to the support and resistance trendlines on the rising wedge on SPX with the latest move up but while wedge support is now once again unbroken, wedge resistance is again being slightly overthrown. I'd note that wedge support and resistance are due to intersect before the end of April, so a high within this wedge should be very close indeed, and I'm expecting the SPX all time high retest this week. SPX 60min chart:
Stan and I are doing a webinar an hour after a close tonight that is the next in our series on trading commodities. We'll be looking tonight at possible trades on copper, oil and coffee. If you'd like to attend you can register for that here, or on our April Free Webinars page.

Monday, 22 April 2019

Topping Is A Process

In my premarket video this morning I was looking at key support and resistance to define what we were likely to see on SPX this week. Resistance I put at the new weekly pivot at 2907.7. ES was opening the week below this and if that held as resistance, then this swing high might be behind us. That has not held as resistance, ES is back above it, at 2910 at the time of writing, and WP is currently holding as support. This opens a very possible retest of the 2019 high and likely at least marginal higher high above that.

ES Jun 60min:
Support is at the always important 50 hour moving average, currently in the 2890 area and strong support through April so far.

SPX 60min chart:
Just below that is the open breakaway gap from 2888.32, tested multiple times since the breakaway gap up on 12th April and holding so far. On a fill of that gap rising wedge support from the March low is now in the 2875 area. SPX 15min chart:
On the bull side I have a strong stat that I called at the start of February, on the break back over the SPX monthly middle band, looking for a retest of the all time high. That doesn't need to be done right now, but obviously SPX is not far away from the all time high at 2940.91. On the bear side the clear rising wedges from the December low on SPX and ES have both broken down, there is negative divergence almost across the board of US indices and a daily RSI 5 sell signal on ES has already fixed.

Stan and I are doing a webinar an hour after a close on Wednesday that is the next in our series on trading commodities. If you'd like to attend you can register for that here, or on our April Free Webinars page.

Thursday, 18 April 2019

Roll On The Weekend

SPX has spent the week inching through the topping process, with some progress particularly yesterday and today. Yet another higher high may be needed, as I was suggesting in my premarket video this morning. That is below with an update on ES and the usual 21 other futures charts.

Full Premarket Video from theartofchart.net - Updates on ES, NQ, RTY, DAX, ESTX50, SPX, NDX, RUT, CL, NG, GC, SI, HG, ZB, KC, SB, CC, ZW, ZC, ZS, DX, EURUSD, USDJPY, USDCAD, AUDUSD:
On the 15min chart the obvious next target would be wedge support, now in the 2871 area. Current support is the open gap from 2888.32, that has been tested today and yesterday and the next move may be to retest the highs to make a second high of a small double top before that open gap is filled to start the first decent move down. SPX 15min chart:
On the 60min chart there has been an RSI 14 sell signal fixed for a few days. If that was not already the case another would have fixed yesterday. The rising wedge from the December low has overthrown and then rising wedge support broke down slightly this morning. This should be at a late stage in the topping process. SPX 60min chart:
The daily RSI 5 sell signal on SPX that started brewing on the break to a higher high last Friday hasn't yet fixed, but daily RSI 5 sell signals have now fixed on ES and RUT. More should fix soon. SPX daily chart:
One thing I would mention is that NDX made a new all time high this week. Has that increased the chance that SPX will make a new all time high before this next turn down? Yes, I think so, but that's still not the most likely thing to see at the high in my opinion. We will no doubt see next week.

Stan and I are doing a free public webinar an hour after the close tonight on our big five and sectors service. We'll be reviewing AAPL, AMZN, FB, GOOG, NFLX, TSLA, IBB, IYR, XLE, XLF, XLK and XRT. If you'd like to attend you can register for that on our April Free Webinars page.

Either way, everyone have a great holiday weekend! :-)

Friday, 12 April 2019

Stick A Fork In It

On Tuesday I was talking about the likely outcomes if SPX/ES managed either to convert the weekly pivot (2879.50) to resistance or failed in that attempt, and the likely outcome in the event that WP held as support was a full retest of the swing high and likely marginal higher high. WP held as support then and, after a near miss yesterday, the full retest and higher high has been seen today. So where is this setup now?

Well as of the highs this morning all four of the rising wedges on SPX and ES from the December and March lows respectively have now slightly overthrown their wedge resistance trendlines. Hourly sell signals are fixed on SPX and RUT here, and daily sell signals are now brewing on all of SPX, NDX and RUT. This setup looks very ready to turn down here. 

On the ES chart I'm wondering about a possible HOD retest to set up negative divergence on the ES hourly RSI. ES Jun 60min chart: 
On the SPX hourly chart I'd note that the low this week was also at a test of short term trend support at the 50 hour MA. That is now in the 2885 area and a break and conversion of this level to resistance is the first step in any serious reversal on SPX. Watching for that SPX 60min chart: 
Daily negative divergence on SPX was lost on the spike up into the last high. That is now back and I'm expecting this to fix soon and deliver a decent decline into May. SPX daily chart: 
Does SPX have to turn here? Will it be forced to reverse course by the awesome power of my mighty trendlines? Well, that's not really the way these things work, but the odds at this stage heavily favor reversal before we see a retest of the all time high now not far above, though my monthly middle band stat that I called at the end of January does have me expecting an all time high retest this year, very possibly in the summer after a low in May. 

Everyone have a great weekend! I know I will :-)

Tuesday, 9 April 2019

Looking At Support Levels

This really is one of the most nicely formed trendline highs on SPX/ES here that I've seen in a while and, so far at least, trendline resistance is holding like a champ. As long as that remains the case we should either be starting the first swing down now or, if the weekly pivot on ES at 2879.50 can't be broken and converted to resistance on this test, we would likely need one more high retest to complete a slightly larger double top than the one that has already formed and broken down on both SPX and ES.

The short term setup here is a double top that might be a Janus bull flag. That's a pattern of mine and I haven't yet found time to write a definition page with examples but the short version is that a double top has formed and broken down slightly. At this stage SPX either heads to the double top target, or rejects back into a full high retest. One of those two scenarios should be next. I talked about the setup here and support levels in my premarket video this morning.

Full Premarket Video from theartofchart.net - Updates on ES, NQ, RTY, DAX, ESTX50, SPX, NDX, RUT, CL, NG, GC, SI, HG, ZB, KC, SB, CC, ZW, ZC, ZS, DX, EURUSD, USDJPY, USDCAD, AUDUSD:
Having said that, I'd like to reflect on the full beauty of the trendline setup here. The strongest setups are a match on both SPX and ES and that is most definitely the case here. On ES the main rising wedge from the December low has overthrown slightly at this high. Wedge support is currently in the 2840 area. ES Jun daily chart:
The smaller wedge from the March low saw a perfect hit of wedge resistance at the high. Wedge support is now also in the 2840 area. ES Jun 60min chart:
On the rising wedge from the December low on SPX there was a perfect hit of wedge resistance at this high. Wedge support is now in the 2850 area. SPX 60min chart
On the smaller wedge from the March low there was also a perfect hit of wedge resistance at the high. Wedge support is now in the 2835 area. SPX 15min chart:
All these rising wedge support trendlines are currently in the 2835-45 SPX area, and will need to be broken to open the downside.

Stan and I were planning to do a free public webinar of Big Five and Sectors (AAPL, AMZN, FB, GOOG, NFLX, TSLA + six sector indices) after the close on Thursday but my internet connection where I will be on Thursday night might not be good enough so we have delayed the webinar until Thursday 18th April. If you'd like to see that you can register for it on our April Free Webinars page. The connection will definitely be good enough to write a post, so I'm planning the next post on on Friday.