• The SPX is doing a very powerful reaction above a critical support level;
• First, as seen in the daily chart, it hit the 3,949 support, and it is doing a powerful reaction. Last Thursday it did a Bullish Engulfing, and las Friday, it broke the 21 ema and the 4k;
• In the weekly chart, it is doing a Hammer candlestick pattern, a bullish reversal pattern that works 60% of the time (according to Bulkowski – Encyclopedia of Candlestick Charts);
• In addition, this Hammer appeared just above the purple line, which was a previous resistance when the SPX was inside a Descending Channel;
• Moreover, this Hammer appeared above the 200 ma, after the index made a Golden Cross (the 50 ma broke the 200 ma upwards);
• All these signs indicate that although the index may look overbought short-term wise, it has decent chances of maintaining the bullish bias mid/long-term speaking, especially if look at the weekly chart;
• I’ll keep you updated on this.
Remember to follow me to keep in touch with my daily analysis!
• First, as seen in the daily chart, it hit the 3,949 support, and it is doing a powerful reaction. Last Thursday it did a Bullish Engulfing, and las Friday, it broke the 21 ema and the 4k;
• In the weekly chart, it is doing a Hammer candlestick pattern, a bullish reversal pattern that works 60% of the time (according to Bulkowski – Encyclopedia of Candlestick Charts);
• In addition, this Hammer appeared just above the purple line, which was a previous resistance when the SPX was inside a Descending Channel;
• Moreover, this Hammer appeared above the 200 ma, after the index made a Golden Cross (the 50 ma broke the 200 ma upwards);
• All these signs indicate that although the index may look overbought short-term wise, it has decent chances of maintaining the bullish bias mid/long-term speaking, especially if look at the weekly chart;
• I’ll keep you updated on this.
Remember to follow me to keep in touch with my daily analysis!
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