SPX is once again, since its uptrend began on 11/06/2023, breaking below the 3-month simple moving average and now also the Monthly Heiken Ashi average (black stepped line).
This time, it seems to have the conditions to start its descent from the mountain and confirm that we reached the top on 02/18/2025.
Looking at the vast majority of stocks in today’s pre-market, this appears to be the scenario.
And this impacts my recent positions. In this scenario, it will seek the 1-year simple moving average, where it should make a pullback (HH or LH?).
Time for caution and to avoid new long entries.
This time, it seems to have the conditions to start its descent from the mountain and confirm that we reached the top on 02/18/2025.
Looking at the vast majority of stocks in today’s pre-market, this appears to be the scenario.
And this impacts my recent positions. In this scenario, it will seek the 1-year simple moving average, where it should make a pullback (HH or LH?).
Time for caution and to avoid new long entries.
Note
As predicted in the analysis, the index found its top and sought support at the 1-year simple moving average. This week, it will likely make a pullback, but for now, I find a long-term bullish recovery highly unlikely.
Notice that at the end of the expansion phase, there was a higher horizontal volume (price-based) above 5,750. Meanwhile, vertical volume increased over the past week during the decline, signaling the market's willingness to liquidate positions.
The pullback should target the 1-month exponential moving average and the 3-month simple moving average. That will be the test to determine whether we are truly headed toward the end of the cycle and market hysteria over a recession.
Trade active
SPX - More Downside AheadOn the Chart:
Timeframe: Weekly
Larger Rectangles: Heiken Ashi High & Low (3 months)
Smaller Rectangles: Heiken Ashi High & Low (1 month)
Background: 1-Year Donchian Channels
Volume Analysis: 20 months
After the accurate call on the S&P 500 cycle top, today will mark the end of any doubts for those still uncertain about the retracement phase ahead.
Losing the 1-year simple moving average (purple line) is a clear sign of exhaustion in the recent expansion since April 2023.
Until the index reclaims the breakout of the 3-month simple moving average (yellow line), there is no reason to consider a recovery.
Manage your buys and be bold with Shorts.
Note
SPX - WOW!
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.