S&P 500: Bearish RSI divergence remains intact despite new ATH

SP:SPX   標準普爾500指數
494 3
Price action looks like a stop loss raid of those who hedged against a pullback on Monday with a short position. Typically this leads to a sharp and fast move higher, followed by a sudden even stronger pullback at a later point in time.

I believe there is a turning point in the trend this week. That's why I doubled down on my bearish outlook.

Short entry: 2822 (ideally 2825)
Stop loss: 2836
Target: 2714
交易進行: Short from 2824
評論: After slowly declining from a high at 2825.91 around 1pm EST, the S&P 500 made a very strong spike upwards and advanced including the very last minute of cash trading. Thereby the S&P 500 closed at the very high of the day at 2833.03.



It's getting harder and harder to forecast any turning points. Which is why I raise my stop loss from 2836 to 2843.5
評論: Once there is finally a pullback (ideally to at least 2769-2767), I will close the short during that pullback, if it does not get stopped out at 2842.5 (this is the newer stop loss I had shared in my last update of my short idea yesterday, as seen above).

I did a lot of analysis today and changed my mind that the rally could actually sustain to go much higher to at least 2960 (after that potential pullback).
交易結束:達到停損點: Stopped out at the open on Wednesday. The S&P 500 gapped up and opened higher yet again at 2845.42, currently trading with a high of 2852.97.

At least I was emotionally prepared to get stopped out today after Tuesday didn't trade weak enough to close the short at break even, that's why I shared this bullish chart yesterday:

Maybe Wednesday is going to be the peak for the week and I was just two days to early with starting to go short, but moving up the stop loss higher and higher every day is a losers game. I was wrong and moving the stop loss up by 7 points was already a mistake in hindsight.
評論: The S&P 500 is finally cooling off. If I hadn't been stopped out with the gap up today, I would have closed my short from 2824 here at 2826

Thanks for your sharing... really good work... we have to wait for the short-term pullback... and long again... your timing is great...
+2 回覆
Hi ChartArt, Thanks for the chart. Any reason for recommending short here? And do you still expect to short?
ChartArt danrindia
@danrindia, There is a ECB (European Central Bank) meeting on Thursday, which could add some turbulence to the markets, if they announce anything the market hadn't expected. Most analysts think the meeting is going to be very boring with no news, which means there is a lot of room for surprise.

After further analysis of the S&P 500 and the breakout of a trend channel to the upside (the strong move yesterday to beyond 2826 to 2833 and today to above 2840), which had occurred AFTER I had shared the bearish outlook. I now lean somewhat more optimistic that any pullback won't be as severe and strong as I had thought yesterday, when my idea was that 2825-2826 to maximum 2834 could be the peak for the week. But I was proven wrong. The market could be far more bullish long-term.
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