On shorter time frames I noticed DMI turning negative on 30 minutes chart, just to recover by the end of the day. This is not surprising keeping in mind that SPX advanced very rapidly from 1022 to 1095 and not as significant as an eventual negative DMI on 60 minutes chart that was a pretty good indicator of a trend change in the intermediate time frames in the last two months.
A quick look at the 3 possible intermediate/long term scenarios here (always need to play the devil's advocate).
The bullish scenario (+++)
-eventually SPX retreat towards the downtrend line but it moves up again from there. -SPX goes above 1105, then 1113 (SMA200)
-daily DMI consolidates it's position
-long term uptrend resumes
-need to watch for EMA50 crossing above EMA100 on daily chart and DMI on weekly chart turning positive to confirm the long term trend change.
The sideways scenario (++)
-SPX is back to 1067-1105 trading range-SPX goes back to the downtrend line but the downtrend line does not hold
-slowly moves down towards 1045-1050 but not bellow. More pushes towards the upper edge of the trading range (11105)
-locked in the 1045-11105 area
The bearish scenario (+)
-SPX plunges bellow the downtrend line, support at 1045, the bellow 1022-God help bulls at this point since it's hard to say where is going to stop.
-probably in the 900-930 area according to "head and shoulder" pattern, the same area where we can find the 2007-2009 recession downtrend line
-a hint that this scenario may happen is going to be a plunge bellow 1045-1050 support area
-even a drop bellow the uptrend line is going to be an early warning. There is absolutely no reason for SPX to slip bellow the downtrend line, now around 1075 and going further down every day if this uptrend momentum is for real
