I'm seeing major positive divergences

Discussion in 'Trading' started by cunparis, Oct 24, 2008.

  1. I'm seeing major positive divergences in the indexes. Here is the S&P:

    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=3&dy=0&id=p31499194469&a=151197522 (attached in the post below)

    MACD, RSI, Williams %R, and Force Index all have major divergences.

    Furthermore I can't believe the overnight move we're seeing. -4.81% as I write this.

    It seems to me the selling pressure has let up. Looking at a 60 minute chart we see that the majority of the volume is on the buying side.


    To me this is positive for the moment.
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  2. Here's the S&P 500 daily chart (linked to above):

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  3. pkts


    I'm big on TA also (also T&A :) ) but my gut tells me we are going lower. I bought the bounce on the 10th but I will not be buying this market for at least a week.

    Good luck if you go long.
  4. Unfortunately I'm already long, from a few weeks ago. yeah, that was stupid.

    The thing is we must follow the charts and not follow our gut. If I had followed the charts I wouldn't be holding my long during the biggest crash in our lives. I'm not making that mistake again.

    But anyway, the charts are telling me we're going up. I'm not saying to buy now, I'm waiting for a breakout of the triangle before adding on longs. Again, let the charts tell me what to do.

    Good luck to you as well. If you bought on the 10th you're in great shape!
  5. Had we closed lower today this would have been a confirmation of a new bearish trend no? The higher volume would have definitely confirmed this.

    I'm curious what you guys think (technically speaking) about the intraday swing that for the last two days has brutally violated the sexy looking wedge.
  6. mind


    same here. this market is testing the lows. and she does
    it quite soon after the last time ... if we break the 850
    i suspect we see 700.
  7. The thing I noticed about the intraday swings is that they have been going down and then after lunch or even in the last 30 minutes the market has moved higher on higher volume. That tells me that the pro's are waiting until the end of the day to buy at a discount. And makes me think buyers are in control.

    All this can change in an instant, but that's what I'm seeing up until now.

    Asia sold off hard this morning and the US markets are following. Another buying opportunity for the pro's. It will be interesting to see where we close.

    It looks like the triangle is getting invalidated, but I'm still seeing support around 860-870. that stopped the down trend yesterday and it stopped it overnight. 860 can be a floor, and if the bears can't push below then price will likely go up to challenge the recent highs.
  8. Why 850? 860 is a support testing twice already in the past 24 hours. The next level is the previous low which was 840.

    If the market makes it to 840 it wouldn't be surprising if it pushes a little lower before pulling back up. This is what the nasdaq has done twice now, both times on lower volume. So I would give it more room than 840. In fact a move below 840 on lower volume and a close above 900 would be a very bullish signal.
  9. mind


    my statement was meant to be broad, thinking in weeks
    not intraday.
  10. Yes, buy the 860's going into the weekend.

    Going higher next week. Don't have a clue why and don't really care either.
    #10     Oct 24, 2008