Short setup on SPXThe SPX has experienced a significant bull run, reaching just below $5700, but is now showing clear signs of weakness, suggesting a potential short setup.
Since mid-July, the SPX has been moving sideways and is now nearly flat at 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 bullish exhaustion (indicated in green), signaling that further price increases are unlikely.
The price has formed a top at its all-time high, as identified by the Bottoms Tops Signal indicator.
A new major resistance level has recently formed, as indicated by the Levels and Zones indicator. While this level could potentially turn into support if the price breaks above it, for now, it remains a resistance, exerting downward pressure on the price.
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.
