S&P 500 index chart pattern
The following comment was made in the previous post on the daily bar chart pattern of S&P 500: "Since the index is trading above its three rising EMAs in a bull market, an upward breakout from the 'flag' is the most logical outcome."
Bulls literally jumped out of the blocks in the New Year. The index broke out above the 'flag' pattern on Jan 2 and then soared to a new high (2743) on Jan 5.
All three EMAs are rising, and the index is trading way above them in a bull market. Daily technical indicators are well inside their overbought zones, and can trigger a pullback towards the top of the 'flag'.
Can the index go on rising in 2018? It would help bulls technically if there is a decent 5-10% correction first. On long-term weekly and monthly charts, RSI has reached overbought levels not seen in 20 years, as per this article.
On longer term weekly chart (not shown), the index closed at a lifetime high - way above its three rising weekly EMAs in a long-term bull market. Weekly technical indicators are well inside their overbought zones. Slow stochastic is showing negative divergence by failing to touch a new high.
FTSE 100 index chart pattern
The daily bar chart pattern of FTSE 100 faced just a day of profit booking when trading began in the New Year on Jan 2. Bulls jumped in to 'buy the dip'. The index rose to touch new intra-day (7728) and closing (7724) highs on Jan 5.
The index is trading well above its three rising EMAs in a bull market. Daily technical indicators are looking overbought. RSI and Slow stochastic are showing negative divergences by failing to touch new highs with the index.
Some correction or consolidation is likely. Stay invested, but control the urge to buy when the index is at a lifetime high. (At the time of writing this post, FTSE is trading 8 points lower.)
On longer term weekly chart (not shown), the index touched a new high and closed above its three rising weekly EMAs in a long-term bull market. Weekly MACD and RSI are in bullish zones but showing negative divergences by failing to touch new highs with the index. Slow stochastic is well inside its overbought zone and can trigger a correction.
The following comment was made in the previous post on the daily bar chart pattern of S&P 500: "Since the index is trading above its three rising EMAs in a bull market, an upward breakout from the 'flag' is the most logical outcome."
Bulls literally jumped out of the blocks in the New Year. The index broke out above the 'flag' pattern on Jan 2 and then soared to a new high (2743) on Jan 5.
All three EMAs are rising, and the index is trading way above them in a bull market. Daily technical indicators are well inside their overbought zones, and can trigger a pullback towards the top of the 'flag'.
Can the index go on rising in 2018? It would help bulls technically if there is a decent 5-10% correction first. On long-term weekly and monthly charts, RSI has reached overbought levels not seen in 20 years, as per this article.
On longer term weekly chart (not shown), the index closed at a lifetime high - way above its three rising weekly EMAs in a long-term bull market. Weekly technical indicators are well inside their overbought zones. Slow stochastic is showing negative divergence by failing to touch a new high.
FTSE 100 index chart pattern
The daily bar chart pattern of FTSE 100 faced just a day of profit booking when trading began in the New Year on Jan 2. Bulls jumped in to 'buy the dip'. The index rose to touch new intra-day (7728) and closing (7724) highs on Jan 5.
The index is trading well above its three rising EMAs in a bull market. Daily technical indicators are looking overbought. RSI and Slow stochastic are showing negative divergences by failing to touch new highs with the index.
Some correction or consolidation is likely. Stay invested, but control the urge to buy when the index is at a lifetime high. (At the time of writing this post, FTSE is trading 8 points lower.)
On longer term weekly chart (not shown), the index touched a new high and closed above its three rising weekly EMAs in a long-term bull market. Weekly MACD and RSI are in bullish zones but showing negative divergences by failing to touch new highs with the index. Slow stochastic is well inside its overbought zone and can trigger a correction.
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