Monday, March 17, 2014

More than 90% of voters in Crimea voted on the side of Russia, adding to the cloud of political tensions of an invasion and some economic sanctions, which is all making equities in Russia even cheaper. To point out the technical picture, Russia took another leg down, using the weekly RSX (Market Vectors Russia etf) chart as a guide. The RSX recorded a ‘perfected’ TD Buy Setup @9 but did so under 23.35, support that has held for 2.5 years. Though RSX can recover above 23.25 again, as investors will see value, the probability of RSX going into TD Sell Countdown remains high. Image

A sharp opening off S&P 500 TD Buy Setup bar 9 on the 4 hour timeframe may serve as more than a short-covering relief rally. Overall, the weekly chart levels hold the most interest this week. Charts are below. 

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S&P 500 (SPX) SHORT TERM OUTLOOK: BEARISH

Flip to neutral if SPX closes above 1852.15 mid-day or 1846.43 end-of-day.

ImageImageWith the 4 hour timeframe recording a TD Buy Setup @9 above the short duration TDST Support cluster between 1839.30 and 1845.42, there is some additional confluence coming from the 2 hour timeframe. Since the 2 hour SPX TD Buy Setup is ‘perfected’, it is not necessary for the final 9 count to record a lower low. These indications support a temporary respite. 

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S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BEARISH

Flip to back to neutral with a close above 1867.63.

ImageWhile it is possible to a green-colored bar on the daily chart, it is too soon to suggest a reversal unless there is a close above 1867.63, the bullish price flip level.  

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S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: NEUTRAL

Flip to bearish if SPX weekly closes below 1836.25.

ImageImageImageImageThe SPX TD Sell Setup is still intact as the SPX held above the price flip level last Friday. Both TD Sell Countdown and TD Combo Sell are still one bar short of recording a 13, which provides some leeway for the upside. For the Nasdaq and the RUT, they also have active TD Sell Setups as well, but the Dow took the lead and flipped bearish on the weekly chart. The outlook remains neutral for the SPX as long as 1836.25 holds this week. 

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S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Flip to neutral if SPX closes below 1805.81 on the last day of March (updated March 3rd). 

 

 

 

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