I still get asked about a forum etc and if I am going to set one up. The answer is a simple one, if you need that amount of regular input, then pay the piper!
Anyways, onwards to the S&P500.
Here is the weekly chart. To give you a hint of what I make of this I am going to rename it the weakly chart.
The ten mile high view shows price pushing up through historic highs with good momentum, then running out of steam and coming back to test the break out. What I dont like is the tail that formed down into what should be support. If buyers were truly interested in buying, they either missed the opportunity (unlikely) or they are not committed to taking this higher.
In recent weeks following the candle with its tail into support, price managed to get back into the origin of the rapid bearish candle that hit support. That is the largest candle closing on its lows. But, the last few weeks since that shows selling starting to show up and its coming off very near term supply in what should have been a test of support. We know its now not true support and we could say that pro money are questioning the strength of buying again.
As I type this the weekly candle is not yet closed, but not far from it and I dont expect any major change in the final candle shape or range. We have to trade what we see and price wants to come down and we need to wait and see what happens when/if it hits support again. Will it hold, will it bounce, will it go through, will it range. These are all questions that must be answered and as yet I cannot find a reliable crystal ball to give me the answers and I have to wait for the only 100% accurate way to know for sure........I give it time.
Daily chart.
Here we get a little closer in on the action and the details start to emerge.
The blue line is support/resistance area which has been tested and held. Where I placed the diagonal black line is the most recent supply and the horizontal black line next to it shows price coming up into near term supply and reacting in a manner that is not bullish. Warning to prospective bulls when you see that, a strong bullish market would and should have broken it. As a result of price falling, we see a real messy range forming where buyers at the bottom of the range are trying to push it higher, likely herd activity from day traders and at the top of the range we see the higher prices cannot break above the previous and is showing more and more weakness with lower higher prices at each peak. Or if it helps to understand it better, place a diagonal line over the tops of the price peaks and you will see the line falls from left to right. Price is getting squeezed into a smaller range.
4 hour chart.
This is the S&P ugly picture we have come to dislike. There are no opportunities on this chart for us until we break out of the mess created by others. The black diagonal line points to a tiny green candle. Sellers came in by the boat load following this, the sharp and dramatic fall has not got a single candle showing even profit taking until the second last candle. It went far too deep to be considered a shake out. Confirming its non shake out status was the reaction. Major push higher and failed just as dramatic. But pro money did step in at the lower light blue line, which is where they should have come in as its the cheapest price and enough room for profit above.
But I think they had a rough ride because most of the herd will have been burned badly and price action shows little in the way of fools left to filter pro money orders into the market. Price took a long meandering course and a longer period of time than expected to get to the line I marked resistance. There would have been a small short off that area as it was established in the past, price reacted as expected and there was a clear target below. But after that the chart is a total mess.
There is minor support but it wont surprise me to see this fail. And there is no fresh places to buy even below that support, we saw three places where some buying came in and none of it I consider to be quality.
Perhaps some news driven event will help pro money move the market out of the ranging mess they created and let us get a piece. For the near term, just watch it and keep well away from it because it will bite you bad if you dip your toe.
We are into the final quarter of the year and typically not a time of the year when earnings show great news and reason for stocks to be bought into in bulk. There is no real good news in most sectors, energy is bad, tech is only fair, finance is bad, pharma slightly good and metals bad.
Remember the old post I made about gold and silver?....where I mentioned the talking heads on TV were saying to buy gold and silver because its cheap and the dollar is going to hell. I did call is BS at the time, and now look at where gold and silver are, and where the dollar went?...proof enough to not listen to the mass media and instead, trust what you see on a chart, they have yet to tell lies!
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