A devastating week for the bulls with SPX losing no less than 42 points in four straight down day. Monday was a bearish reversal day when SPX spiked to 1132 then closed 3 points down. That set the tone for the rest of the week and only today bulls managed to control the damage a little bit. SPX touched the lower edge of the trading range (1067), went up to 1083 then gave away 6 points at the close.
EMA50 crossed EMA100 on both 30 and 60 minutes charts giving a sell signal. This is a clear indication that the market is trading in range since the buy signal was generated just a week ago. When market is in an uptrend or in a downtrend the buy and the sell signals are 3-8 weeks apart or maybe more. The real question now is for how long is the market going to trade in this range? That remains an open question since neither bulls nor bears seam to be in control on either intermediate or long term time frames. With market bellow SMA200 the odds are a little bit in the favor of the bears.
Meantime if you want to trade this market you can either use Williams %R oscillator I mentioned yesterday or even MACD and DMI on 60 minutes charts. I had some success with these indicators in the past. The problem with using them on 60 or even 30 minutes charts is that you may need to be very quick, you may need to go in and out even 1-3 days apart and you will definitely need to be glued to the computer. This is not my favorite style of trading but some people find this appealing.
Have a nice weekend!
P.S. Just in case you are too excited by the 3 points gained by SPX today (LOL) look at widget bellow, updated in real time, that shows the number of crimes, US debt, how many HIV infected people are around the World and so on.