S&P 500 index chart pattern
The following remark in last week's post on the daily bar chart pattern of S&P 500 may be worth noting: "A convincing move (i.e. accompanied by strong volume support) above the 'gap' is required for the index to rise to new highs."
The downward 'gap' (formed on Jan 30) was completely filled on Mon. Aug 6. The next day, the index opened with an upward 'gap' to touch a high of 2863 - just 10 points short of the lifetime high of Jan 26 - but lacked strong volume support.
Bears used the opportunity to stall the rally. On Fri. Aug 10, the index opened with a downward 'gap' and dropped to seek support from its 20 day EMA before closing with a weekly loss of 7 points.
Daily technical indicators have corrected overbought conditions, and are showing downward momentum. MACD is about to cross below its signal line. RSI is falling towards its neutral zone. Slow stochastic has dropped from its overbought zone. All three showed negative divergences by failing to rise higher with the index.
Some more correction or consolidation is likely. Expect the support/resistance zone between 2780 and 2800 to provide good support on the downside. In case the index corrects further, the upper edge of the large 'symmetrical triangle' should provide stronger support.
On longer term weekly chart (not shown), the index closed above its three rising weekly EMAs in a long-term bull market, but formed a 'shooting star' candlestick that can trigger a correction. Weekly MACD and RSI are in bullish zones but not showing any upward momentum. Slow stochastic has started to correct inside its overbought zone.
FTSE 100 index chart pattern
After touching a lifetime high of 7903.50 on May 22 '18, the daily bar chart pattern of FTSE 100 has been consolidating sideways and straddling its 20 day and 50 day EMAs. The index is trading above its gradually rising 200 day EMA in a bull market.
Bears are selling on every rise, while bulls are buying the dips. For the past two months, the index has formed a bullish pattern of 'higher bottoms and higher tops' - possibly in anticipation of a favourable BrExit deal with the EU.
Daily technical indicators continue to look neutral to bearish. MACD and RSI are in neutral zones and showing slight downward momentum. Stochastic is falling towards its 50% level.
On longer term weekly chart (not shown), the index closed above its three rising weekly EMAs in a long-term bull market. Weekly MACD has crossed below its signal line in bullish zone. RSI is falling in bullish zone. Slow stochastic is falling below its 50% level.
The following remark in last week's post on the daily bar chart pattern of S&P 500 may be worth noting: "A convincing move (i.e. accompanied by strong volume support) above the 'gap' is required for the index to rise to new highs."
The downward 'gap' (formed on Jan 30) was completely filled on Mon. Aug 6. The next day, the index opened with an upward 'gap' to touch a high of 2863 - just 10 points short of the lifetime high of Jan 26 - but lacked strong volume support.
Bears used the opportunity to stall the rally. On Fri. Aug 10, the index opened with a downward 'gap' and dropped to seek support from its 20 day EMA before closing with a weekly loss of 7 points.
Daily technical indicators have corrected overbought conditions, and are showing downward momentum. MACD is about to cross below its signal line. RSI is falling towards its neutral zone. Slow stochastic has dropped from its overbought zone. All three showed negative divergences by failing to rise higher with the index.
Some more correction or consolidation is likely. Expect the support/resistance zone between 2780 and 2800 to provide good support on the downside. In case the index corrects further, the upper edge of the large 'symmetrical triangle' should provide stronger support.
On longer term weekly chart (not shown), the index closed above its three rising weekly EMAs in a long-term bull market, but formed a 'shooting star' candlestick that can trigger a correction. Weekly MACD and RSI are in bullish zones but not showing any upward momentum. Slow stochastic has started to correct inside its overbought zone.
FTSE 100 index chart pattern
Bears are selling on every rise, while bulls are buying the dips. For the past two months, the index has formed a bullish pattern of 'higher bottoms and higher tops' - possibly in anticipation of a favourable BrExit deal with the EU.
Daily technical indicators continue to look neutral to bearish. MACD and RSI are in neutral zones and showing slight downward momentum. Stochastic is falling towards its 50% level.
On longer term weekly chart (not shown), the index closed above its three rising weekly EMAs in a long-term bull market. Weekly MACD has crossed below its signal line in bullish zone. RSI is falling in bullish zone. Slow stochastic is falling below its 50% level.
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