"No warning can save people determined to grow suddently rich" - Lord Overstone

  • 1 hour The Calm Before The Storm In Tech Stocks
  • 3 hours Japan Scrambles To Dodge Trump’s Trade War
  • 18 hours Big Banks Double Down On Crypto Ambitions
  • 19 hours Investor Debt Outpaces S&P 500 Growth
  • 20 hours Will Bitcoin Ever Dethrone Gold?
  • 21 hours China's Orwellian Social Media Machine
  • 22 hours What Sparked Russia’s Gold Buying Spree?
  • 1 day The War For "White Petroleum"
  • 1 day Stock Market Bulls Are Running Out Of Steam
  • 1 day Crypto Stocks Poised To Bounce Back
  • 2 days The Five Biggest Bubbles In Stock Market History
  • 2 days Was Finland’s Universal Basic Income Program A Failure?
  • 2 days China Goes Long On Gold
  • 2 days Is It Wise To Trade The Trump Effect?
  • 2 days The Tech That Telecom Giants Fear Most
  • 2 days China’s EV Industry Is Booming
  • 2 days How Will Gold React As North Korean Tensions Cool?
  • 2 days Is This The Biggest Mining Opportunity Of 2018?
  • 3 days China’s $33 Trillion Finance Industry Opens To Foreign Investment
  • 3 days Is Bitcoin Cash Overbought?
Investor Debt Outpaces S&P 500 Growth

Investor Debt Outpaces S&P 500 Growth

Since the financial crisis of…

Is This The Death Of The iPhone X?

Is This The Death Of The iPhone X?

Apple’s stock has slipped more…

Mike Paulenoff

Mike Paulenoff

Mike Paulenoff is author of the MPTrader.com, a real-time diary of his technical analysis and trading alerts on ETFs covering metals, energy, equity indices, currencies,…

More Info

SP 500 Vulnerable to Downside Test of Lower Bollinger Band

The juxtaposition of the Bollinger Bands with the price structure has caught my attention ahead of the weekend. Let's notice that since Wednesday's peak at 1075.75, which reversed from just beneath the upper BB, the S&P 500 emini price declined directly towards the rising 20-day moving average, which represents the mid-point between the upper and lower BBnds. Within a bull trend accompanied by rising momentum (RSI), it is typical of a decline to hold in and around the 20 DMA and then turn to the upside to continue to higher-highs. Such was the case during April, May and then again from mid-July to the present.

Notice, however, what happened during the 4-week period between June 5 and July 8, when the emini S&P hit the top BB, reversed and plunged beneath the rising 20 DMA to the lower BB, accompanied by a falling momentum RSI gauge.

The decline amounted to about a 9% correction. This week's downward reversal from the upper BB has plunged to test the rising 20 DMA so far.

Given the sharply falling momentum RSI gauge, might the emini S&P and the S&P 500 Depository Receipts (SPY) for those following the ETF -- be vulnerable to downside continuation to test the lower BB, now 986? We shall find out very soon, but my work argues that just such a technical set-up is facing traders.

 

Back to homepage

Leave a comment

Leave a comment