• 3 hours Stocks Mixed On Italy Turmoil, China Rebound
  • 6 hours China Plans To Launch The First Artifical Moon
  • 8 hours How The World’s Most Bearish Fund Will Play The Next Crash
  • 24 hours America Has A Milk Problem
  • 2 days Chinese E-Commerce Giant Eyes Aggressive Expansion
  • 3 days Institutional Movement Reinforces Bullish Sentiment In Crypto Markets
  • 4 days $100M Saudi Payment For Syria Fails To Help ‘Davos in the Desert’
  • 4 days Supply Issues Weigh On Pot Stocks As Canada Goes Legal
  • 4 days CME Bitcoin Futures Surge As Bullish Sentiment Grows Louder
  • 4 days How Do Your Savings Stack Up To The Top 1 Percent?
  • 5 days Amazon Favored To Win $10 Billion Pentagon Contract
  • 5 days American Steel Downgraded As Trade War Escalates
  • 5 days From Gold To Bitcoin: The Evolution Of Money
  • 5 days Italy Budget "Not Compatible With Commitments That Exist In The EU"
  • 6 days U.S. Deficit Defies Economic ‘Boomtime’
  • 6 days Saudi Business At Stake Over Journalist Murder Allegations
  • 6 days Trump Bails On Coal Industry Incentives
  • 6 days Google Opens Up About "Project Dragonfly"
  • 7 days Retail Sales Rebound, But Is It Enough To Post Positive Earnings?
  • 7 days Stocks Continue To Slide As Economic Fears Fester
EU Weighs New Payment System With Iran To Skirt U.S. Sanctions

EU Weighs New Payment System With Iran To Skirt U.S. Sanctions

Demonstrating its eagerness to continue…

Time To Buy A Lada? Russian Auto Sales Are Booming

Time To Buy A Lada? Russian Auto Sales Are Booming

Russia’s flagship carmaker was once…

  1. Home
  2. Markets
  3. Other

The State of the Trend

A few weeks ago we mentioned that two different cycles, connecting weekly swing highs and lows, converge at the beginning of March. The index price action which followed was a testament to their opposing effect. The 1820 low we were expecting held and the SP500 staged an advance to finish February barely lower than the close on January 30th.

This can be best seen in the monthly chart which, from a trend following point of view, has something to offer to both the pessimist and the optimist.

For those who view the glass as half empty and follow a MACD system tuned to the historical rate of vibration of the index, the trend turned in June '15, and remains negative to this day:

S&P500 Monthly Chart

For those who view the glass as half full, and follow a simple moving average cross-over system, the uptrend remains intact and the index is undergoing a normal correction which won't lead to a trend reversal:

S&P500 Monthly Chart 2

The combined interaction of both strategies can be seen here, and it shows that we remain in the caution zone:

S&P500 Monthly Chart 3

From a swing trading point of view, however, the picture is much less ambiguous, as the SPX is in an upswing in all three time frames (daily, weekly, and monthly).

The monthly SP500 upswing will remain intact as long as the index trades above 1962:

S&P500 Monthly Chart 4

The weekly upswing will remain in effect so long as the SP500 trades above 1910, while for the daily upswing to continue, the index needs to trade above 1950 and the 1 x 1 angle which is currently at the same level:

S&P500 Daily Chart

The last couple of weeks did wonders for bullish sentiment which reached exhaustion levels suggesting that a sideways/down move should begin shortly. This is likely to coincide with the next CIT date of March 7th.

Weekly Sentiment

 

Back to homepage

Leave a comment

Leave a comment