Short setup on SPX (x2)

After the most recent upward move, the SPX shows clear signs of weakness, suggesting a potential short setup.

Since mid-July, the SPX has been moving upward and it's now near its all-time high. However, the RSI Exhaustion at the bottom of the chart has significantly declined and hasn't recovered much, establishing a downtrend.

This divergence between the price and the RSI Exhaustion is the first major signal of a possible short configuration.

Three additional signs support this setup:

The RSI Exhaustion shows recent bullish exhaustion (indicated in green), signaling that further price increases are unlikely.
The price has formed a top just shy of its all-time high, as identified by the Bottoms Tops Signal indicator.
A major level has formed, as indicated by the Levels and Zones indicator. While this level turned into support, it originated as resistance and could well revert back to it should be price start to drop further.

Is the bull run over? Only time will tell, but for now, it's crucial to remain patient and always seek confirmation from the indicators.

Note

It's getting even worse.

Note

About to break down

Note

Two high-probability tops and an extremely bearish configuration. Short trade opportunity.

Trade active

As highly anticipated by the two TOPS and the RSI Exhaustion, the price went down to test the Support level. We can now expect a short to moderate rebound, before a trend continuation, or a rapid downfall.
Either way, the trade was extremely clear and already very profitable.

Note

Downtrend continues from the previous setup. Additionally, the support is turning into a resistance so expect the SPX to fall further.

a.b

🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻🔻

📈 Trading Indicators
💚 1-Week FREE Trial: minimalisttrading.com
❤️ Trading videos: bit.ly/MT-Channel

📊 Stock Analysis
💜 FundaView: fundaview.com

🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺🔺

Also on:

Related publications

Major downtrend in SPX

by a.b