The S&P 500 is chopping near record highs, and some traders may see downside risk.
The first pattern on today’s chart is October 6’s all-time of 7,845 -- less than half a percent above its previous record in early August. The index has made higher lows at a steeper angle, creating a potentially bearish ascending wedge.
Second, Friday’s high surpassed Thursday’s. A lower low followed. Such a bearish outside day could be viewed as a reversal signal.
Third, the index dipped under its 50-day simple moving average for the third time in barely a month. Is the intermediate-term uptrend fading?
Next, the S&P 500 Volatility Index (VIX) ended last week above a falling trendline that started in June. That may reflect growing risk.
Finally, SPX bounced at 7,508 on September 16 and 7,617 on October 1. While the index hasn’t broken down yet, declines through those levels may confirm the start of greater selling.
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Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options or futures); therefore, you should not invest or risk money that you cannot afford to lose. Online trading is not suitable for all investors. View the document titled Characteristics and Risks of Standardized Options at https://www.TradeStation.com/DisclosureOptions. Before trading any asset class, customers must read the relevant risk disclosure statements on https://www.TradeStation.com/Important-Information/. System access and trade placement and execution may be delayed or fail due to market volatility and volume, quote delays, system and software errors, Internet traffic, outages and other factors.
Securities and futures trading is offered to self-directed customers by TradeStation Securities, Inc., a broker-dealer registered with the Securities and Exchange Commission and a futures commission merchant licensed with the Commodity Futures Trading Commission). TradeStation Securities is a member of the Financial Industry Regulatory Authority, the National Futures Association, and a number of exchanges.
TradeStation Securities, Inc. and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., both operating, and providing products and services, under the TradeStation brand and trademark. When applying for, or purchasing, accounts, subscriptions, products and services, it is important that you know which company you will be dealing with. Visit https://www.TradeStation.com/DisclosureTSCompanies for further important information explaining what this means.
The first pattern on today’s chart is October 6’s all-time of 7,845 -- less than half a percent above its previous record in early August. The index has made higher lows at a steeper angle, creating a potentially bearish ascending wedge.
Second, Friday’s high surpassed Thursday’s. A lower low followed. Such a bearish outside day could be viewed as a reversal signal.
Third, the index dipped under its 50-day simple moving average for the third time in barely a month. Is the intermediate-term uptrend fading?
Next, the S&P 500 Volatility Index (VIX) ended last week above a falling trendline that started in June. That may reflect growing risk.
Finally, SPX bounced at 7,508 on September 16 and 7,617 on October 1. While the index hasn’t broken down yet, declines through those levels may confirm the start of greater selling.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options and futures. If you're born to trade, we could be for you. Learn more here about TradingView’s Broker of the Year!
Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options or futures); therefore, you should not invest or risk money that you cannot afford to lose. Online trading is not suitable for all investors. View the document titled Characteristics and Risks of Standardized Options at https://www.TradeStation.com/DisclosureOptions. Before trading any asset class, customers must read the relevant risk disclosure statements on https://www.TradeStation.com/Important-Information/. System access and trade placement and execution may be delayed or fail due to market volatility and volume, quote delays, system and software errors, Internet traffic, outages and other factors.
Securities and futures trading is offered to self-directed customers by TradeStation Securities, Inc., a broker-dealer registered with the Securities and Exchange Commission and a futures commission merchant licensed with the Commodity Futures Trading Commission). TradeStation Securities is a member of the Financial Industry Regulatory Authority, the National Futures Association, and a number of exchanges.
TradeStation Securities, Inc. and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., both operating, and providing products and services, under the TradeStation brand and trademark. When applying for, or purchasing, accounts, subscriptions, products and services, it is important that you know which company you will be dealing with. Visit https://www.TradeStation.com/DisclosureTSCompanies for further important information explaining what this means.
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La información y las publicaciones no constituyen, ni deben considerarse como, asesoramiento o recomendaciones financieras, de inversión, de trading u otro tipo, proporcionadas o respaldadas por TradingView. Obtenga más información en Condiciones de uso.
Exención de responsabilidad
La información y las publicaciones no constituyen, ni deben considerarse como, asesoramiento o recomendaciones financieras, de inversión, de trading u otro tipo, proporcionadas o respaldadas por TradingView. Obtenga más información en Condiciones de uso.