Price has finally turned down … but how significant is this turn?
If the cash S&P500 closes below 1675.02 today (Wednesday) then a price flip will be recorded that triggers the TD Sequential “sell” signal that printed bar 13 on July 8th. Instead, if the market resumes the rally without a price flip, any move above the 1692.51 level will give us a new TD Setup and recycle our sequential countdown.
On the RSI chart (top pane) we now have a bearish divergence between the indicator and price. Please note that this divergence is occurring in the 63-67 zone which often signals that a market is transitioning into a bear phase. However, this signal is tempered by the fact that the Composite Index (middle pane) made a new extreme high along with price. This is a warning signal that any sell-off may be shallow. Let’s see if we can trigger the sequential signal today.
1 comment:
Saxby, good to see you back. Hope things are working out for you. Just to offer you a suggestion. What you have presented is just fine, but when you see an over run of a 13 count as we have on the daily, it's probably not the defining metric for exhaustion at this time. Instead, either move up a degree on the charts (the weekly is forming a Sequential 11 this week) or possibly the TD Combo which is currently at a 12 count waiting for a 13. One of those 2 is more likely to be "the one".
Here's a chart with the Combo (in white) added.
Regards, Wallfly :))
http://www.screencast.com/t/qVs6JE1uFWY
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