SPX analysis [17May20 UPDATE]

Updated

See also my previous analysis, examining historical behavior and confluences with indicators.
+ Fractal based speculation of how far down the index might go.

A look at the S&P 500 Chart (weekly and daily charts)

Note

Technical analysis works best during relatively stable market phases, where psychological factors dominate price movement. The COVID-19 trigger of the massive dip of a global "tofu" economy (ready to crumble) is a blackswan -- where TA is ineffective as a probabilistic "edge" for trading.

Has the dip "priced in" what is about to come? Historically, during a full-blown recession, 40-50% dips from the 200 weekly SMA for the SPX and DJI again is plausible. Presently these two important market indices appears to hold and find support over the 200 weekly SMA. However fundamentally speaking (learning about the actual market situation worldwide, in significant economies, such as the US, China, Europe, especially Italy and Germany atm) doesn't bring much confidence.

A further crash seems highly probable -- e.g. even just looking at the technical indicators alone at the higher timeframe, everything is looking bearish. Although some bullish divergence is starting to emerge on the shorter time frame, that is likely to lead to nothing more a dead cat (bull-trap) bounce, before continuing on into a SPX/DJI-based full blown economic recession phase.

Need to wait out until a new market structure is established after the "reset" and then go on from there.

Note

Another next-leg-down MA that have strong historical confluence as an important support/resistance level, with past recessions is the purple 377 weekly candles SMA. Right now the index is being supported by it, even though it have already plunged and closed below the 200 weekly SMA.

Note

S&P 500 looking weak.

Note

Holding below and getting rejected continuously by the 200 weekly SMA.
My CYBER ENSEMBLE {PREMIUM} script is still not registering a "Buy" on the 3 hrly.
Not wise to long.. High chance of continued selling come Monday.

Note

A more bearish look after re-analysis and reassessing the market. No bullish divergence hinting of the possibility of any short term bounce at all. Also, as the saying goes: it is harder for a good trader to long during a bear market than a bad trader to short (and vice versa during a bull market), so with that in mind ...

S&P 500: Not wise to bet on a dead-cat bounce. [22Mar'20]

cybernetwork

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