SPX: Loss of a Critical Support Level.
• The SPX is crashing again, after it bounced yesterday. In fact, yesterday’s bounce seems to be a false breakout from our dual-resistance area made by the lower purple trend line and the 3,885 red line;
• This is a sign of weakness, and since it can’t get above the 3,885 key point, in theory, the index is going to seek its next support level at 3,773;
• In order to avoid such a drop, it is very important to see it closing above 3,885 this week. This wouldn’t be a bullish reversal, though, but it would at least stop the bear trend;
• In the weekly chart we see why the situation is so delicate. After a false breakout from a a pivot point (4,100), the index is just melting, losing its support levels;
• Now, the SPX is back inside the Descending Channel, and again, the 3,773 is our key point here;
• Therefore, in order to avoid this scenario, we would need to see a very impressive bullish reaction – so far, there’s none;
• I’ll keep you updated on this.
Remember to follow me to keep in touch with my daily analysis!
• This is a sign of weakness, and since it can’t get above the 3,885 key point, in theory, the index is going to seek its next support level at 3,773;
• In order to avoid such a drop, it is very important to see it closing above 3,885 this week. This wouldn’t be a bullish reversal, though, but it would at least stop the bear trend;
• In the weekly chart we see why the situation is so delicate. After a false breakout from a a pivot point (4,100), the index is just melting, losing its support levels;
• Now, the SPX is back inside the Descending Channel, and again, the 3,773 is our key point here;
• Therefore, in order to avoid this scenario, we would need to see a very impressive bullish reaction – so far, there’s none;
• I’ll keep you updated on this.
Remember to follow me to keep in touch with my daily analysis!
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