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The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex

N.B.
* The content in my articles is time-sensitive. Each one shows the date and time (New York ET) that I publish them. By the time you read them, market conditions may be quite different than that which is described in my posts, and upon which my analyses are based at that time.
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* From time to time, I will add updated market information and charts to some of my articles, so it's worth checking back here occasionally for the latest analyses.

DISCLAIMER: All the information contained within my posts are my opinions only and none of it may be construed as financial or trading advice...

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* Trade Wars have escalated and now include diplomatic wars PLUS President Trump is cannibalizing prior U.S. market gains with his tariff tantrums against its world trading partners, while destabilizing a delicate world market balance

Thursday, April 26, 2018

SPX Reclaims 2650 Level: Dead-Cat Bounce or Higher Prices Ahead?

I last wrote about the SPX, 10YT and SPX:VIX ratio here.

After this morning's gap up, and as at 1:00 pm ET, the S&P 500 Index (SPX) has popped back above its 2650 major resistance/support level, as shown on the following daily chart.

It's back in the red zone in between 2700 and 2650, which form major resistance and support, respectively. Near-term resistance levels are 2673 and 2692 (formed by intersecting channel lines).

The momentum indicator is still below zero, so any further rally should bring it back above that level to support further SPX strength. Otherwise, beware of a potential "dead-cat bounce" as price either stays mired in the red zone, or drops back below 2650, to, possibly, lower lows for the year.


The SPX:VIX ratio has popped back above the 150.00 Bull/Bear Line-in-the-Sand level, as shown on the following daily ratio chart.

The RSI has also popped back above the 50 level. However, the MACD and PMO indicators are showing signs of weakening, so watch for any bearish crossover, as well as a drop of the RSI back below 50 to signal rising volatility and potential sustained selling in the SPX.


After the 10YT popped briefly above the 3% level, it has fallen back below, as shown on the following daily chart.

The recently-expanding action of the momentum and relative volatility index indicators, in both directions, reflects the increased volatility in the SPX, of late.

A break and hold above 3% could blunt any further rally in the SPX. If that happens, watch to see whether MOM and RVI produce higher swing highs to confirm its sustainability above that level.