SPX - Weekly, Daily, Hourly

My anlaysis is based on Trend and Momentum. Best signals come when both are in Sync. Blind trend following is dangerous. Look what happened to Gold last week. The upward trend was intact, but the momentum clearly gave a sell signal. Those who ignored the momentum got clobbered.

There's been a lot of top picking and top calling in the stock market. Let's examine what the markets are saying.

SPX Weekly - Momentum buy, Trend Buy























The weekly picture is very clear. We have a weekly breakout and the market is consolidating above the breakout line. Look at the CCI, which is yet to show divergences with the price. This most likely means the top is at least another 1-2 weeks away. The weekly Full Stoch is also rising and no crossover there.

SPX Daily - Momentum Buy, Trend Buy





















The daily trend is up as evidenced by the EMAs and the trendline itself. The daily chart is a bit of concern in the ST term. The price is perched on the trendline, break of which could lead to the retest of recent lows. So far we have had 4 failed breakout attempts. Again we need momentum divergences here, which has not yet been established.


SPX Hourly - Momentum Sell, Trend Buy






















Hourly chart is suggesting some sort of expanding formation here. Look at how the CCI is going from extreme to extreme, which is typical of an expanding environment. In a contracting environment, the CCI keeps oscillating around the zero line. Hourly is on a momentum sell, but is still a buy on a trend basis. If we take out the trendline from 12/8, we could see some serious selling, causing the EMAs to slant downwards and create crossovers, issuing a trend sell. Until the Trend and momentum are both on sell, it's a weak sell and one tends to accumulate a lot of false signals in the long term by taking those weak signals.

So for VST, i will go long on Monday, if we get a hourly momentum buy. If the hourly trend turns down, i will go short.