Prop-toberfest Winding Down

Stock Market Technical Analysis Blog

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In the market today we saw the end of the powerful 5-day tractor program that Ben had clamped down on the market, forcing it to trade in a narrow tube slightly upward as seen in chart 1 above. It served him well by getting the market as high as possible even though we were at the upper channel line a week ago to put some cushion below the current level in case the market reacted severely to his change in rhetoric to a less dovish stance which is in a way a bit of relief as it appears now that at least there really was a purpose for the 5-day tractor program and not the beginning of a dangerous bubble (at least let's hope not).

Taking a look at the charts above:

1.  7-day intraday chart of SPY showing 5-day tractor program that was turned off at the open today
2. 120min bar chart of VIX showing two very large EMAs that are notorious for triggering major selloffs when the red EMA crosses above the blue EMA or bounces up from the blue EMA.  We closed with the two merging at a point
3. Day candles of SPY showing today's selloff
4. Week candles of SPY showing a topping shooting star as of this evening
5. SPY managed to close right at its orange EMA 
6. VIX shows big jump at the open today
7. SPY not down to its upper channel line yet
8. VIX trying to break out of its orange sideways channel
9. SPY dropped considerably today
10. VIX re-energized after consolidating at lower channel line
11. SPY still ridiculously overextended from its 100 day EMA
12. SPY momentum fading as major lift appears to be done
13. SPY selloff agrees with upper float turnover line and shows it is still away from the 15 EMA line
14. SPY ADX - shows the expansion between the positive and negative line is now contracting 
15. SPY shows it is still well up in its 5th Gann ray sector and the MACD below it is starting to show some fast line closure
16. SPY is still well out of the congestion of the traditional large SMAs
17. SPY closed right at the line over from last week's spike
18. SPY Fibonacci - will take a couple days of selling before I post another Fibonacci set from the top down.  Also, note the huge red spike in volume today after volume had declined steeply for three weeks 
19. SPY 2-year chart shows it is still above the steeper two year blue line secondary channel
20. 25 year chart of S&P
21. 2-year chart of NASDAQ - a very important chart to examine tonight as the Nasdaq has been climbing from its lower channel line to its upper for an entire year and is now stalling at the upper line.  Well known that it has been the leader for the bullish sentiment
22. 2-year chart of DOW showing it is at its upper line of its horizontal blue channel

For the next couple days Chart 2 above will likely be Ben's greatest concern if the red line starts lifting above the blue line because then real trouble starts for the market as can easily be seen with its previous line junctures.

Trade well my friends

Alan