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Sunday, December 27, 2015

Stock Index Chart Patterns: S&P 500 and FTSE 100 – Dec 24, 2015

S&P 500 Index Chart

Bulls decided to spread some Christmas cheer to the daily bar chart pattern of S&P 500. In a holiday-shortened trading week, the index rallied past its three EMAs to close in bull territory with a weekly gain of almost 3%.

Despite touching a lifetime high in May '15, the index has lost a bit of ground during the past year. A 'symmetrical triangle' pattern appears to be forming, from which a breakout can occur in either direction.

Daily technical indicators are turning bullish. MACD is about to cross above its signal line in negative zone. RSI and Slow stochastic have moved above their respective 50% levels.

Some consolidation can be expected during the last trading week of the year, when activity is likely to remain low.

On longer term weekly chart (not shown), the index closed above its three weekly EMAs in a long-term bull market. Weekly technical indicators are in bullish zones but not showing much upward momentum.

FTSE 100 Index Chart

The daily bar chart pattern of FTSE 100 rallied past its 20 day and 50 day EMAs but stopped well below its falling 200 day EMA in a trading week truncated by Christmas holiday.

The index continues to trade in a bear market, though daily technical indicators have turned bullish. MACD is rising above its signal line in negative zone. RSI and Slow stochastic have climbed past their respective 50% levels.

The rally was accompanied by low volumes, which raises questions about its sustainability.

On longer term weekly chart (not shown), the index closed below all three weekly EMAs in a long-term bear market despite closing higher for the 2nd week in a row. Weekly technical indicators are in bearish zones, but showing some upward momentum. 

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