SPX closed barely above its 18 SMA. However, breadth was negative and we had less new highs then the last two days. That was not much of a victory for the bulls. We will need to see some follow through. Lets zoom in to the 130 minute SSO chart.
I have adjusted the red resistance line to better reflect recent price action. The down trend line has been removed since it never got validated by price action. Lets zoom in a little closer to the 60 minute chart.
In addition to the support and resistance lines I have added some new trend lines. Price looks to be forming a triangle pattern. I feel comfortable in saying that breaking one of those trend lines will spur a decent move.
We gapped up three days in a row and failed to find any rally chasers. Even though we closed higher then the last two days, internally the market was actually weaker. Since 9/26 the price action looks kind of like a bear flag to me. We have had three upside gaps in a row after achieving a short term oversold condition. If the market was going to take off to the upside wouldn't it have done so by now? Maybe upside gap number four will do the trick, LOL.
Chart practice has been updated with BBBY the stock for today. I don't usually toot my own horn, but the stock I highlighted Monday night (NFLX) was up over 10% today. I wish I could find those everyday, LOL. http://traderbob58-chart-practice.blogspot.com/
Bob
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