US500 - distribution zone?US500 - distribution zone?
These are the Keylevels to watch in the next hours.
I want to short US500 under the support line, this neckline looks good for an entry.
Also, this zone looks more and more like a distribution zone.
Us500
S&P500: As long as the 1D MA50 holds, it remains bullish.The S&P500 reached our first TP1 = 4,295 (see previous idea at the bottom) and touched the top of the Channel Up pattern that guided the index out of its November market bottom. Technically this calls for caution as the probabilities of a HH rejection at the top are high, despite the 1D time frame staying on harmonized green technicals (RSI = 62.614, MACD = 30.510, ADX = 17.939).
However as long as the 1D MA50 holds, it is maintaining a diverging Channel Up that can easily cross through R1 (4,330) and target soon the R2 (4,516.50). The potential change of sentiment and long term pattern is evident on the 1D MACD, which is past a Bullish Cross. For as long as those two conditions hold, we will remain bullish (TP1 = 4,330 and TP2 = 4,500).
If the price crosses under the 1D MA50 and the 1D MACD gives a Bearish Cross, we will stop buying and reverse to selling, initially to S1 (TP1 = 4,045) and eventually the bottom of the Channel Up (TP2 = 3,895).
Prior idea:
## If you like our free content follow our profile to get more daily ideas. ##
## Comments and likes are greatly appreciated. ##
S&P500 could start a 1 month correction.The S&P500 hit both targets we set two weeks ago as it reached the top of the 7 month Channel Up pattern:
This is the first major sell signal that we get on the 1D time-frame since the previous Higher High on February 02 2023. Unless the price closes a 1D candle above the August 16 2022 High (4327), we expect a short-term pull-back towards the 1D MA50 (blue trend-line) and Inner Higher Lows 1. Our Target is 4200. This sell signal will be invalidated if we close above 4327.
If we close a 1D candle below the Inner Higher Lows 2, we will re-sell and target the 1D MA200 (orange trend-line) and bottom of the Channel Up at 4000.
-------------------------------------------------------------------------------
** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! **
-------------------------------------------------------------------------------
💸💸💸💸💸💸
👇 👇 👇 👇 👇 👇
A Traders’ Playbook: China stimulus expectations lift sentimentLooking at the calendar for the week ahead and it’s a quiet affair by way of known event risks to catalyse. We have tier 1 idiosyncratic event risks, with the RBA and BoC meetings holding the potential for a 25bp hike respectively. However, I’d expect the central focus to remain on the USD, US rates pricing, US regional banks and whether we see a further positive flow into the HK50, CHINAH and CN50.
Talk of fiscal support from the Chinese authorities have been making waves and on Friday it’s no surprise that we saw $3.18b net buying into China’s mainland equity markets, amid a 4% rally in the Chinese/HK equity indices – this supported EU and US equity sentiment, copper and the AUD found a better bid (notably vs the EUR and CHF).
After a nirvana US nonfarm payrolls report (a strong level of job creation, amid softer wages and a higher unemployment rate) we now head into the Fed’s blackout period, with the market favourable to the Fed leaving rates unchanged next week but signalling a strong bias to hike again.
Next week’s US CPI print could alter the consensus view of a Fed ‘skip’, but with the core of the Fed leaning to a pause – for now, this is supporting risk and we roll into the new week with the bulls on top.
Digging further into the equity move and breadth was solid on Friday with 92% of stocks closing higher, led by materials, industrial and energy, but the chase is on – FOMU (Fear of Meaningfully Underperforming) is a factor, few want to sell, portfolio hedges are being unwound rapidly and it was momentum frenzy, with the 0DTE crowd have a large hand in this chase higher.
There is a heightened focus on the US Treasury Department starting to tap the market to rebuild its low cash balances – we get 3 sizeable US T-bill sales this week equating to $173b, so the eyes of the market will be whether this is supported by bank reserves or RRP balances. Again, US banks will be keenly watched (put the KRE ETF on the radar), because if bank reserves prove to be the larger support of T-bill issuance it may start to weigh on sentiment here.
Finally, crude saw a 2.6% rally on Friday, largely due to a solid rally in China’s markets. Some would have been covering shorts ahead of the weekend OPEC meeting. However, those running longs would be heartened at the news the Saudis will reduce output by an additional 1m bpd. The news flow on potential China stimulus and the tape in its equity markets will continue to dictate how crude trades - but clearly, the Saudis want a crude price above $80 and a steeper backwardation in the futures curve. Keep an eye on the CAD, and NOK as tradeable crude proxies.
Marquee event risk for the week ahead
RBA meeting (Tues 14:30 AEST) – We could be looking at a lively RBA meeting with the market pricing a 50% chance of a hike. There is greater conviction from economists with 17 of 25 economists (surveyed by Bloomberg) calling for a pause. Market positioning is mixed, with asset managers running a sizeable AUD short position, while fast-money leveraged funds are progressively long of AUD. RBA action will likely have a short-lived impact on the AUD before it reverts to a tradeable proxy of China data and moves in the HK50 and CHINAH.
Bank of Canada (BoC) meeting (8 June 00:00 AEST) – BoC meetings here have been predictable affairs of late, but there is some uncertainty at this meeting – it’s a risk event to consider for CAD traders. The interest rate markets price a 44% chance of a 25bp hike, although the economist community are far more certain with only 6 of 31 (surveyed by Bloomberg) calling for the hike. Into the meeting, the risk for the CAD seems skewed to the downside, where the BoC likely hold and guide to a hike in July conditional on a hot employment report.
China trade balance (Wed - no set time) – the market looks for a further lift in the trade surplus to $94.15b. To get to this increase surplus exports are expected to decline by 2%, while imports are expected to decline by 8%. A key data point given the impact China is having on market sentiment, but this is so incredibly hard to forecast, that the market is conditioned to be shocked.
China CPI/PPI inflation (Friday 11:30 AEST) – The market expects CPI to come in at 0.2% YoY and PPI at -4.2% YoY. With elevated expectations of imminent policy easing from the PBoC, we’d need to see a blowout upside print to reduce expected policy easing calls. Bad news (i.e. lower inflation) should only further increase policy-easing expectations and prove to be good news for the HK50 and the AUD.
China new yuan loans (no set time) - the market looks for new loans to increase to RMB1570b (from RMB718b). With calls for renewed economic stimulus, I expect credit data to start reflecting this going forward to rise from here. I don’t expect the May credit data to move markets too intently unless it’s a substantial beat/miss.
US ISM services (Tues 00:00 AEST) – the market looks for the diffusion index to rise to 52.4 (from 51.9). In a quiet week of US economic data, the services ISM report has the potential to influence market sentiment. However, after both Fed chair Powell and VC Jefferson recently leaning towards a pause (or a skip), it’s hard to see this moving rate expectations for the June FOMC meeting too intently. The US CPI print (due 13 June) is the likely decider on whether the Fed pause or hike.
Canada May employment report (Tues 22:30 AEST) – the market expects 25k net new jobs to have been created in May, with the unemployment rate eyed at 5.1% (from 5%). The form guide suggests a higher probability of a beat, with the last 8 employment reports coming in above expectations. Momentum in USDCAD is lower and we see good support into 1.3330.
Rates Review – we look at market pricing of interest rate expectations and the cumulative number of hikes/cuts (in basis points) for each upcoming meeting. For example, we see 10bp of hikes (a 40% chance of a hike) priced for the June FOMC meeting, but 9bp of cuts to have been implemented by December.
Central bank speakers to navigate:
Fed speakers – the Fed are in a blackout period until the FOMC meeting (14 June), so we can breathe a little easier.
ECB speakers – we hear from Lagarde, Nagel, Guindos, Panetta, Guindos, De Cos, Centeno – EU rates markets price 24bp of hikes for the 15 June ECB meeting, and a peak rate of 3.66% by October.
RBA speakers – RBA gov Phil Lowe speaks the day after the RBA meeting (Wed 09:20 AEST). RBA deputy gov Michele Bullock speaks shortly after (Wed 09:50 AEST)
S&P500 Closed above the 1W MA100 after almost 300 days.Major bullish signal for the S&P500 (SPX) as it closed a 1W (weekly) candle above the 1W MA100 (green trend-line) for the first time since the week of August 15 2022. That was the weekly candle that formed the next Resistance 1 in line, the 4330 level (Aug 16 High).
The 1W RSI has already broken above its Rising Wedge since two weeks ago and the 4330 Resistance 1 test seems inevitable. That will be the final barrier before testing the 4640 level of Resistance 2 (March 28 2022 High).
Needless to say, the index is long past the Bear Cycle, having broken above the Lower Highs trend-line, with the 1W MA50 (blue trend-line) in Support. The target of the Inverse Head and Shoulders pattern (Fibonacci 2.0) is marginally above Resistance 2.
-------------------------------------------------------------------------------
** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! **
-------------------------------------------------------------------------------
💸💸💸💸💸💸
👇 👇 👇 👇 👇 👇
ES1! SPX500USD 2023 JUNE 05 WEEKES1! SPX500USD 2023 JUNE 05 WEEK
Once price breaks out of 4303 and it becomes support,
market will likely test next level 4584.
Scenario Planning:
1) Continuation long: Long on retracement
Note:
Longer Term: 4150 need to hold as support in order for
long trend to remain intact.
Volume Analysis:
Daily/Weekly: Ave vol up bar close toward high = NTC strength
Price reaction levels:
Short = Test and Reject | Long = Test and Accept
4584-4525 4303 4150
*NTC = Non Trend Changing
Remember to like and follow if you find this useful.
Have a profitable trading week.
*For educational purpose only.
S&P500 The August 2022 is the Resistance but the index can peak The S&P500 / SPX / US500 is extending the rise inside the long term Channel Up, supported by the 1day MA50.
As long as the 1day MA50 supports, we will stay bullish with the 4330 August 16th 2022 posing as the next Resistance.
Every rally inside the Channel Up however has been at least +9.50% so we expect a peak on the Channel Up top at 4400 if the August 2022 top breaks.
If a candle closes under the 1day MA50, seel and target 4030 (bottom of the Channel Up).
Previous chart:
Follow us, like the idea and leave a comment below!!
Breakouts & Breakdowns Are Occurring!Traders,
As debt ceiling issues appear to be being resolved, the market is becoming even more bullish. Fear (VIX) is dropping to multi-year lows, the dollar continues its longer-term drop, and the stock markets are popping with several breakout signals. What does this mean for our crypto space? Let's take a closer look.
Stew
Unemployment in the U.S. and 13 states to watch out forWith the unemployment data being scheduled for release today, we would like to focus on this topic. Previously, we stated that historically, each 1% rise in unemployment within the United States was accompanied by a recession. Therefore, today, we want to highlight a few interesting trends in unemployment with regard to specific states rather than a whole country. Below, we list 13 states that stood out to us and which might be worth to be paying attention to (in the remaining 37 states, unemployment was either still declining or not showing any significant growth in the past year, although that does not mean that they are less worthy of watching out for).
Unemployment trends in particular states:
- District of Columbia - up from 3.9% in August 2022 to 5% in April 2023 (+1.1% increase).
- Oregon - This state saw unemployment rise from 3.5% in March 2022 to 4.8% in October 2022. Then the unemployment rate stayed unchanged until February 2023, when it started to tick down. In April 2023, the unemployment in Oregon stood at 4%.
- Kentucky - Unemployment in Kentucky rose from 3.3% in December 2022 to 4.6% in February 2023. Then, it quickly declined in the following two months, printing 3.2% in April 2023. Though, we would like to emphasize that changes in the unemployment rate in Kentucky are historically volatile, at least based on the FRED’s data.
- Wyoming - The unemployment rate was 3.2% in April 2022 and rose to 3.9% in October 2022. Then similarly, like in Kentucky, it stayed unchanged until February 2023. After that, the rate started to decline, reaching 3.5% in April 2023.
- New Jersey - In New Jersey, the unemployment rate stood at 2.8% in September 2022. In February 2023, this figure rose to 4.1% and then started to decline. In April 2023, unemployment was down to 3%.
- Virginia - The unemployment in Virginia was 2.5% in June 2022. In November 2022, it rose to 3.2%. Since then, the unemployment rate in the state remained between 3.1% and 3.2%.
- Kansas - In Kansas, unemployment rose from 2.4% in April 2022 to 3% in November 2022. After that, it continued to print 2.9% in the next five months.
- Minnesota - The unemployment in Minnesota rose from 2.3% in April 2022 to 3% in November 2023. In April 2022, it came in at 2.8%.
- Iowa - At the start of the second quarter of 2022, Iowa's unemployment rate was 2.3%. In September 2022, it reached 3.1%; later, in December 2022, it started declining. Unemployment in Iowa reached 2.7% at the start of the second quarter of 2023.
- Missouri - In June 2022, the unemployment rate in Missouri was trending at 2.1%. Then, in October 2022, it reached 2.7%, where it held until February 2023. In April 2023, this figure came in at 2.5%.
- Vermont - In Vermont, unemployment rose by 0.9% between April 2022 and October 2022. However, after that, it started to fall, hitting 2.4% in April 2023.
- New Hampshire - In April 2022, the unemployment rate in New Hampshire equaled 2.1%. In October 2022, it was already at 2.9%. However, it started to fall in January 2023 and erased the whole rise in April 2023.
- Nebraska - In April 2022, unemployment stood at 2% in Nebraska. After that, it started to rise, reaching 2.7% in December 2022. Despite this uptick, unemployment quickly fell to 2% by the end of April 2023.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
S&P500 Near the top on two patterns. Pull back possible.S&P500 is testing Resistance (1) on the Channel Up inside the larger Megaphone pattern. Currently it is at the top on two separate patterns.
The MA50 (1d) is supporting the Channel Up and the MA200 (1d) the Megaphone.
Trading Plan:
1. Sell on the current market price.
2. Buy on Support (1).
3. Sell under Support (2).
Targets:
1. 4175 (Support 1).
2. 4300 (top of Channel Up).
3. 4000 (bottom of Megaphone and near MA200 1d).
Tips:
1. The RSI (4h) Highs (70.00) and Lows (30.00) match perfectly the Tops and Bottoms of the Channel Up. Use this to your advantage. RSI values of 70.00 are to be sold while values of 30.00 to be bought, as long as the Channel Up holds.
Please like, follow and comment!!
Notes:
Past trading plan:
US500 to find support at next Fibonacci retracement?US500 - Intraday - We look to Buy at 4155 (stop at 4135)
Levels close to the 50% pullback level of 4170 found buyers.
A Fibonacci confluence area is located at 4164.
Bespoke support is located at 4150.
There is scope for mild selling at the open but losses should be limited.
Although the anticipated move higher is corrective, it does offer ample risk/reward today.
Our profit targets will be 4205 and 4215
Resistance: 4220 / 4230 / 4235
Support: 4168 / 4164 / 4120
Risk Disclaimer
The trade ideas beyond this page are for informational purposes only and do not constitute investment advice or a solicitation to trade. This information is provided by Signal Centre, a third-party unaffiliated with OANDA, and is intended for general circulation only. OANDA does not guarantee the accuracy of this information and assumes no responsibilities for the information provided by the third party. The information does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
You accept that you assume all risks in independently viewing the contents and selecting a chosen strategy.
Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, Oanda Asia Pacific Pte Ltd (“OAP“) accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore customers should contact OAP at 6579 8289 for matters arising from, or in connection with, the information/research distributed.
The US Treasury cash rebuild; volmageddon or a nothing burger
While Congress still needs to pass the debt limit agreement, the debate in the market has shifted to the need for the US Treasury Department (UST) to rapidly rebuild its depleted cash levels.
We have no understanding of the timetable, but already the debate is whether the significant level of Treasury bill issuance will result in a major headwind for global financial markets, while others believe this is pure hype.
Some are contrasting what lies ahead as a massive liquidity withdrawal from financial markets – Quantitative Tightening (QT) on steroids – where we will essentially see USD liquidity sucked out of the system.
The process of raising cash levels
To raise and rebuild its now low cash balances, the US Treasury Department (UST) will look to issue around $1.3t of US T-bills over the following 12 months. Around $700b of this T-bill issuance will be fast-tracked, tapping up the market within a matter of months, with the private sector expected to buy what the Treasury is selling.
US Treasury bills (‘T-bills’) are high-quality debt instruments which have a maturity of less than 12 months.
With the US Treasury replenishing its cash balances it would be able to make ongoing payments and meet its obligations. Plus they will keep its additional capital on the Fed’s balance sheet (under the Treasury General Account or ‘TGA’) for future payments.
The effect on markets
The concern in the market is around the notion of a “liquidity drain” – whereby the UST remove such staggering levels of liquidity out of the system, in a short period, that we see bank funding costs heading markedly higher and USD rates rising to highly concerning levels. Could this dynamic cause renewed concerns in the US regional banks?
Drilling into the theme - the potential stress in markets really comes down to who exactly absorbs the issuance, as this is key in determining the potential impact on system liquidity.
A drawdown in RRP balances
US money market funds (MMF) have historically been the big buyers of T-bill issuance and could again play a key role in supporting the USTs quest to recapitalize. Money funds currently have near-exclusive access to the Fed’s Reverse Repo facility or ‘RRP’ (TradingView code – RRPONTSYD), and have around $2.2t parked there, where they get 5.05% (annualized) risk-free.
If US T-bills are issued to the public at a yield close to the RRP rate (of 5.05%), then there’s a case that we see money funds withdrawing a sizeable level of holdings from the RRP facility and supporting the US T-bill issuance.
It is widely considered that risk assets (e.g. equities) would not be impacted when a large percentage of the USTs issuance is funded by RRP balances. In fact, some are saying this could be a net positive given there has been a scarcity of high-quality T-bills in the system of late.
A drain in bank reserves would be more problematic for markets
Banks are required to hold a level of reserves as a percentage of their deposit base. However, banks/depository institutions often hold reserves in excess of their regulatory requirements - this can be highly advantageous should they have to meet increasing deposit withdrawals.
Instead of keeping these excess reserves (cash equivalent) on their balance sheet, they can be offered to the Fed, where since 2008 they will receive interest paid at 5.15% (annualized) through the Fed’s IORB facility (Interest on Reserve Balances - TV code: WRBWFRBL).
The RRP and IORB spread guides overnight lending rates
With the RRP rate currently at 5.05% and IORB paid at 5.15% this spread represents the corridor by which the fed funds effective rate (EFFR) – the rate at which banks will borrow/lend cash overnight – trades. This is the fundamentals of how the Fed sets monetary policy and to date, it has been very effective.
The concern from some is where money funds have less involvement in supporting UST T-bill issuance - resulting in a comparatively low RRP drawdown – with a large percentage of the issuance supported by a drain of bank reserves.
Some strategists estimate that of this potential $700b in near-term T-bill issuance around $400b to $500b of this will be funded by the liquidation of bank reserves balances. That could the scenario where we could – in theory - see higher market volatility.
It’s really about a scarcity of reserves
There are currently $3.28t of excess bank reserves parked on the Fed’s balance sheet - so if we were to see a $500b drawdown in reserves then this balance would fall quite rapidly to around $2.8t. This is important because many feel the Lowest Comfortable Level of Reserve (LCLoR) that must be in the financial system is between $2.5t and $2.2t.
Interestingly, some feel an aggressive decline in reserves would be a headwind for risk assets – if we look at the regression between reserves and S&P500 futures, we can see an R^2 of 0.79. In effect, 79% of the variance in US equity futures can be explained by reserves – statistically, it’s very meaningful.
So this injects some credence to the idea that reserve drawdown could be a short-term headwind for risk. However, where this becomes interesting, and where we would see true stress in the system is through monitoring the spread between the Fed’s effective rate (TradingView Code: EFFR) and upper bound of the rates channel and Interest paid on Reserve Balances (on TradingView code: IORB).
Currently, this spread sits at -7bp, but if we were to see the fed funds effective rate (EFFR) moving to the top of this corridor and even trading at a premium to IORB, it’s at this point where the market is telling us that we’re moving closer to a scarcity of reserves in the system.
This is where things would be far more prone to breaking, and the Fed will need to act swiftly.
When EFFR trades at a premium to IORB it essentially portrays that the money market channels are breaking and demand for short-term loans is becoming increasingly inelastic – subsequently, those in need of short-term loans will continue to pay ever higher prices.
Of course, this may not play out. We may see reserves falling precipitously and risk assets and the USD show no relationship at all to this dynamic. However, it is a risk, and we need to recognise the triggers and be open to the possibility it does cause a higher volatility regime, especially given it comes at a time when EU banks are having to pay back E500b of TLRO loans to the ECB.
Price is true, but I will be the moves in the KRE ETF (US regional bank ETF), as well as watching the EFFR- IORB spread as this could be far more important for the USD and signs of increased risks in the financial system.
US500 Will Go Down! Sell!
Take a look at our analysis for US500.
Time Frame: 9h
Current Trend: Bearish
Sentiment: Overbought (based on 7-period RSI)
Forecast: Bearish
The market is trading around a solid horizontal structure 4188.5.
Due to the fact that we see a positive bearish reaction from the underlined area, I strongly believe that sellers will manage to push the price all the way down to 4152.1 level.
P.S
We determine oversold/overbought condition with RSI indicator.
When it drops below 30 - the market is considered to be oversold.
When it bounces above 70 - the market is considered to be overbought.
Like and subscribe and comment my ideas if you enjoy them!
S&P500 Potential DownsidesHey Traders, US500 was trading in an uptrend and successfully managed to break it out, currently we are waiting for a correction in order to see a potential retrace of the trend towards more lows. I would also keep an eye on DXY to confirm the Bias as a strong Dollar should be heavy on indices.
Trade safe, Joe.
S&P500 - Long from bullish order block ✅Hello traders!
‼️ This is my perspective on US500.
Technical analysis: Here we are in a bullish market structure from 4H perspective, so I am looking for longs from discount zone. I expect price to continue the retracement to fill the imbalance lower and then to reject from bullish order block.
Like, comment and subscribe to be in touch with my content!
US500: Expecting Bullish Movement! Here is Why:
The charts are full of distraction, disturbance and are a graveyard of fear and greed which shall not cloud our judgement on the current state of affairs in the US500 pair price action which suggests a high likelihood of a coming move down.
❤️ Please, support our work with like & comment! ❤️
DOW JONES TRADE IDEAUS30 is forming a bearish trend. We should expect more bearish movements at the open of the New York trading session.
Bearish thesis is being put to the testWhile we have to admit that the U.S. economy is proving to be more resilient than we initially expected, we can not ignore that the market is going through a very uneven recovery. It is no myth that SPX and NDX have been propelled by a handful of companies related mainly to the hype in the AI sector (including Apple, Alphabet, Amazon, Microsoft, Meta Platforms, and Nvidia). However, when these companies are excluded from the calculation of the index, SPX’s year-to-date performance is actually negative.
As only about 40% of the stocks within the index are above the 200-day SMA, we can make a compelling case that more companies might join the rally, which could lead to more broad recovery and completely invalidate our thesis about the bear market rally. Due to that, we will pay close attention to this metric and focus on the incoming data, including Chicago PMI, JOLTs job openings, ISM Manufacturing PMI, initial jobless claims, nonfarm payrolls, and the unemployment rate. To support our thesis about the bear market rally, we would like to see an uptick in unemployment and signs of contraction in services (which is crucial because, so far, we have seen a contraction only in manufacturing). In addition to that, we would like to see further weakness in the Chinese stock market and economy (because, as we previously noted, if China is not doing well, then the West is likely not to do well).
In regard to the price action, we pay close attention to the critical level near $4,200. If SPX fails to hold above this level, it might signal exhaustion and potential short-term/medium-term trend reversal. Contrarily, if SPX holds above the resistance and more stocks start climbing above the 200-day SMA, it will be a positive sign, potentially suggesting more upside ahead.
Illustration 1.01
Illustration 1.01 portrays the daily chart of SPX minus Apple, Amazon, Alphabet, Microsoft, Meta Platforms, and Nvidia; when these six companies are excluded from the index, SPX’s year-to-date performance is actually negative at approximately -8%.
Illustration 1.02
Illustration 1.02 displays the percentage of SPX stocks above the 200-day SMA.
Technical analysis gauge
Daily time frame = Neutral
Weekly time frame = Neutral
*The gauge does not necessarily indicate where the market will head. Instead, it reflects the constellation of RSI, MACD, Stochastic, DM+-, ADX, and moving averages.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
S&P500 Rising Wedge's short-term pull-back to the 1D MA50The S&P500 index (SPX) gave us the expected pull-back and buy entry within the Rising Wedge as per our last week analysis (chart below):
The long-term structure is a Channel Up, so plan your trades in case of a Rising Wedge break-out. On the short-term, we expect the price to pull-back to the 1D MA50 (blue trend-line) and the bottom of the Rising Wedge at 4140. As long as the pattern holds, buy and target the top at 4250. If the top of the Wedge breaks, target 4295m just shy off the long-term Resistance of 4327 (August 15 2022 High).
We will sell on the medium-term only if the price breaks below Support Zone 1 and target the 1D MA200 (orange trend-line), above Support Zone 2 and at the bottom of the long-term Channel Up. The 1D RSI Triangle pattern can give an early signal with regards to the direction in case of a break-out.
-------------------------------------------------------------------------------
** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! **
-------------------------------------------------------------------------------
💸💸💸💸💸💸
👇 👇 👇 👇 👇 👇
And now some cautionary chartsTraders,
Though my post yesterday reflected more bullish sentiment, I would be remiss not to acknowledge a few of the contrarian indications that I am also spotting on various charts which suggest we could still experience more of a drawback in crypto before Bitcoin crosses to the topside of that all-pervasive $30,500 resistance overhead. Let’s take a look at a few of the charts which seem to suggest this possibility.
#1. DXY
The dollar is now expected to continue moving up in strength. I see the next line of resistance at 105.6. Dollar UP + VIX UP = Stocks DOWN (generally).
#2. VIX
The fear index (VIX) is at a multi-year low. Considering all that is going on in the world recently, it is highly likely that the VIX will spike again soon taking us back above our 200 day moving average. Dollar UP + VIX UP = Stocks DOWN (generally).
#3. US500
I have been using our US500 chart to pattern what the rest of the market might do on a swing scale timeframe. I have been calling for a break down from the ascending red wedge. Should this occur, crypto is likely to follow.
#4. Bitcoin CME Futures
A new gap was created below us on the Bitcoin CME futures chart. 99% of all gaps are filled …usually sooner rather than later.
#5. Bitcoin (see current chart above)
Yesterday, I pointed out more than a few bullish indications for Bitcoin. But I also want to remind you that we’re not out of the woods yet.
One, I already mentioned that we have not defeated our overhead resistance, that big orange area above us along with the $30,500 mark.
Two, we have not confirmed a move above our orange neckline area.
Three, I was expecting more of a test in that green area below us which is the neckline of our larger Cup and Handle pattern. I was surprised that we did not get more of a test in that area. But, we still may.
I do not plan on selling my current trades, which are all in the profit, just yet. But should BTC dip back below that black trendline it is currently using for support, I just may.
Stew
Bullish breakout invalidated, divergence between SPX and HSIYesterday, the S&P 500 Index succumbed to market pressures and fell below the critical resistance level of $4,200. By doing so, SPX invalidated a bullish breakout above the narrow range (the zone between $4,050 and $4,200) and retraced very close to the 20-day SMA. This development might suggest exhaustion for the rally, but it is still too early for bears to call a victory. Therefore, to confirm the continuation on the downside, we would like to see the price break below the 20-day SMA and test support near $4,100 (and later near $4,075 and $4,050). On the contrary, to support a bullish case, we would like to see SPX breaking above the narrow range. In regard to technical indicators bolstering a bearish case, we would like to see RSI, Stochastic, and MACD (on the daily time frame) decline along with the price (and simultaneously, DM+ and DM- converging). To support a bullish view, we would seek divergence between DM+ and DM- and reversal (to the upside) in RSI, MACD, and Stochastic.
Besides these developments, we want to bring attention to another subject: the Chinese stock market. A big emphasis was placed on China’s reopening in early 2023 after more than two years of lockdowns. In fact, the main narrative in the media was that this reopening would spur demand and help to divert the economic slowdown in the West. Consequently, we saw a rally in the U.S. equities coinciding with a slight rebound in some economic activity (but with the still relatively mixed big picture). During this time, we saw a high correlation between SPX and Hang Seng persist. However, in the last four weeks, Hang Seng has been increasingly diverging from SPX. That catches our attention as the excuse of recovery in China was used to prop up the Western markets, but now the Chinese stocks are seemingly rolling over (with Hang Seng losing 16% already from its 2023 high). We believe that if the selloff in the Chinese market continues, it will likely weigh on the thesis about recovery and dodging the recession.
Illustration 1.01
Illustration 1.01 shows the daily chart of SPX. The orange line represents the Hang Seng index. A strong positive correlation can be observed between SPX and HSI in the period between November 2022 and April 2023.
Technical analysis gauge
Daily time frame = Neutral
Weekly time frame = Neutral
*The gauge does not necessarily indicate where the market will head. Instead, it reflects the constellation of RSI, MACD, Stochastic, DM+-, ADX, and moving averages.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
US500✔️ Tags New Yearly High ✔️ US500 is expected to rise
✔️ Recommended to consider buying from the balance and premium level 4.184 & 4.172
S&P500: Upside limited to the August 2022 High. Buy the pull bacThe S&P500 index is approaching the top of the Megaphone pattern inside the wider Channel Up. The 1D time frame is bullish technically (RSI = 59.471, MACD = 22.900, ADX = 16.182) but only moderately. If the price crosses over the Megaphone, we will buy the breakout and target the top of the Channel Up (TP = 4,295). If not, we will buy the pull back near the 1D MA50, which is supporting since March 30th and target the R2 and August 16th High (TP = 4,330).
If the index though crosses and closes under the 1D MA50, we will sell and target the S1 (TP = 4,045) and further closing under the S1, will target the bottom of the Megaphone and 1D MA200 (TP = 3,985).
Prior idea:
## If you like our free content follow our profile to get more daily ideas. ##
## Comments and likes are greatly appreciated. ##
