I’ve updated the earlier post with a daily chart of $SPX just below the 60min chart.
Quick chart of SPY in 60min time frame, which is showing very over bought at present. One would have to expect a pull back or consolidation in the next few sessions from such overboughtness, though with a three day break it would be anybody’s guess. And while guessing, I would imagine that Zweig Breadth Thrust and 4wk New High/Low Ratio will also show extreme overboughtness when they are updated later this afternoon.
Note the large volume spike in the last hour.
Chart courtesy of FreeStockCharts.com
So $SPX has now broken above the falling trend line and closed above it twice, and today $SPX closed above the 200MA for the first time in about 6 weeks. The authoritative down trending line was tagged more than a dozen times before it finally gave way yesterday. This should be bullish going forward. On the other hand, the rising trend line has not yet been tested and so it lacks any real authority. Because of that, I’ve added another trend line, the red line on the chart, that ignores the outliers. This trend line was hit twice and then tested a third time and so this may be the trend line to watch. Either way, both the lower trend lines are rising and for now that’s all that matters.
Enjoy you three-day break.