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Monday, July 18, 2016

S&P 500 and FTSE 100 charts (Jul 15 '16) - bulls make merry after casting aside BrExit fears

S&P 500 index chart


The daily bar chart pattern of S&P 500 brushed aside all bearish concerns and climbed to touch a lifetime high of 2169 on Fri. Jul 15, but formed a small 'reversal day' bar that can temporarily halt the bullish surge.

Note the sliding volume bars during the sharp rally from the Jun 27 low of 1992. The index has run up well above its 20 day EMA. Such a rally can't sustain for long. 

All three daily technical indicators are in bullish zones, but looking overbought and showing negative divergences by failing to touch new highs with the index.

This may be as good a time as any to take some profits home.

On longer term weekly chart (not shown), the index traded well above its three rising weekly EMA in a long-term bull market for the 19th week in a row. Weekly technical indicators are in bullish zones and looking overbought.

FTSE 100 index chart


The daily bar chart pattern of FTSE 100 almost touched the 6750 level on Thu. Jul 14 - its highest level in nearly a year - but formed a 'reversal day' bar and dropped below 6650.

At the time of writing this post, the index is trading near 6700 - well above its three rising EMAs in bull territory.

Of the three daily technical indicators, MACD and Slow stochastic are moving sideways inside their overbought zones. RSI is also trading sideways, just below its overbought zone.

The index has taken recession concerns due to BrExit in its stride, and is likely to move higher after a bit of consolidation.

On longer term weekly chart (not shown), the index is trading well above its three weekly EMAs in bull territory, and closed above all three EMAs in a long-term bull market for the 3rd week in a row. Weekly technical indicators are looking overbought and hinting at a correction or consolidation. 

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