The following remarks appeared in last week's post on the daily bar chart pattern of S&P 500: "... all three daily technical indicators are inside their overbought zones. Another corrective move may be in the offing."
The index took a couple of steps up and then three steps down to end almost flat on a weekly closing basis. On Tue. Dec 13, the index rose to touch a new lifetime high of 2278 but slipped down to close only a point lower for the week.
Volumes surged on Fri. Dec 18, which may be a sign of selling climax. Note a similar surge in volumes on Nov 30 and Dec 1 that marked the end of a brief corrective move.
All three daily technical indicators are in the process of correcting overbought conditions. Slow stochastic is showing negative divergence by touching a lower top while the index rose higher. It has also formed a 'double top' reversal pattern inside its overbought zone.
Some more correction or consolidation is possible. But bulls are clearly in charge - as can be seen from the three rising EMAs.
On longer term weekly chart (not shown), the index closed well above its three weekly EMAs in a long-term bull market for the 41st week in a row, but formed a 'long-legged doji' candlestick pattern. All three weekly technical indicators are in bullish zones but showing negative divergences by failing to touch new highs with the index. Expect some more correction or consolidation.
FTSE 100 index chart pattern
The following remarks appeared in last week's post on the daily bar chart pattern of FTSE 100: "... At the time of writing this post, a pullback towards the down trend line is under way. If you missed buying on the break out above the down trend line, the pullback is providing another buying opportunity."
The pullback to the top of the down trend line on Mon. Dec 12 did provide a buying opportunity as the index bounced up strongly on Tue. Dec 13 and closed the week above the 7000 level after almost 2 months.
All three EMAs are moving up and the index is trading above them in a bull market. The index may touch a new high soon.
Daily technical indicators are in bullish zones. Slow stochastic is showing negative divergence by touching a lower top inside its overbought zone. A bit of correction or consolidation may follow.
On longer term weekly chart (not shown), the index closed above its three weekly EMAs in a long-term bull market for the 25th week in a row. Weekly technical indicators are in bullish zones.