Charting the S&P 500: Bulls Take Control of the Trend
Stocks were up each day during the holiday-shortened week, but here's why the week ahead is very important.
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It was a huge win for the bulls this past week as the indexes powered up on good volume trends. We still could use a follow-through week, though, so that makes this upcoming week very important for the trend to move back into bullish territory. You may recall just a couple weeks back there was an inverted hammer (big arrow on the top pane) that was the start of a corrective move.
Once that candle is exceeded and confirmed, we should see new highs arrive, and likely before Santa makes his annual run. The indicators are starting to turn bullish again but need a couple more weeks (bars) to see that happen. Stochastics (pane 4) look as if they are the first to turn, while the candles in the top pane are still teal, so cautiously bullish on the GoNoGo composite of indicators.
The one important indicator, the moving average convergence divergence (MACD), seems to have stabilized and is looking to make a bullish crossover soon. That won't likely happen for a couple of weeks, but that might lead into the new year with a bullish technical condition. We'll see how it goes, but the bulls have the ball once again.
