Rumor has it that China will say bye bye to the trade deal. Futures were down when that “news” hit the Twitter. Now they’re up.
Stock Market Trading Setup for Tuesday, May 12, 2020
S&P Futures Daily Chart
The ES futures were up 5 at 2928 at 8:30 AM in New York.That’s up 33 from where they were this time yesterday. Yes there’s been a lot of bouncing around.
They have traded in a range of 2895 to 2936 overnight and this morning. As of this writing they were sitting right on the centerline of the latest uptrend channel. Talk about regression to the mean. You can see on the chart how they’ve been hanging around that line.
Support levels are around 2880 and 2855-60. The bottom of the uptrend channel is at approximately 2830. That would need to be broken, at a minimum, for there to be a chance of a downtrend developing.
The daily oscillators tuned to an 8 week cycle are still bullish on balance.
Rate of Change continues moving sideways near the zero line. Upturns from around the zero line are normally very bullish. Likewise, downturns from this level are typically very bearish.
MACD tuned to the same cycle has been moving sideways above the level reached in the Q4-Q1 advance. This signifies that the market is in trending mode. This indicator stayed near this level for 3 months before the market topped out. I wouldn’t get bearish until this turns down and price breaks support.
Again, this is for the perspective of one day only. The purpose of these reports is not to divine the longer term. If you want longer horizons, I cover that in the Technical Trader service at Lee Adler’s Liquidity Trader.
Hourly ES S&P 500 Futures Chart
The hourly chart is a mess, with the price moves not coloring within the lines. At least, not within the trend channel lines. But the trading has been rangebound between the 2886 support level, and resistance now defined at 2938, and 2946.
It’s all noise all the time until they break out of that range.
There’s no 5 day cycle projection. A 3 day cycle projection looks like 2953. That would be a breakout. We’ll see. That would imply a move beyond that to test the April rally high of 2965.
Momentum, True Strength, and MACD tuned to a 5 day cycle are bullish, on balance.
Reminder- I’m only talking patterns for a day here. This is not the big picture. If you want that story, you must subscribe. Risk free trial and all.
Join me on the Capitalstool.com message board today and I will update you there occasionally during the day. Feel free to join the “fun.”
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