Well, GE got put on ratings watch, that’ll cost the market a few points!
Below is a 30 minute chart of the DOW. Note the orange triangle… that would be a bullish triangle since it was entered from below. Also note the stochastic just curled up from the bottom with the fast crossing the slow – a buy signal. Also note the RSI at the bottom; the last peak is higher than the previous peak, yet if you look up you’ll see that price wise the last peak was lower than the last peak. That’s a positive RSI divergence – a small one, but positive none-the-less (it can also be seen on the 60 minute chart).
I also note that the SPX has not gotten to the same place in its chart and thus more downside is possible before turning.
We STILL have not gotten away from that double red line, the inverted H&S neckline! Note that it now is in the same place as the bottom of the new orange triangle. Does it hold? I think it probably will. We also have a positive divergence in the fact that the VIX is down 6% at the same time that equities are down. I still don’t like the behavior and am still playing small.
Will have another update after the close.
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