$SPX : Watch out for the kumo twist

In my previous post, I was hoping for 1218 to hold. The market open below 1218 and I did not manage to get a good confirmation to go long.

The market has continue to be weak since.

Even as the futures is now up on German business confidence, the bearish sentiment remains.

On the Ichimoku chart, we can now see that the leading kumo may be twisting. This is a sign that the trend is changing.

Moving forward into the new year, I will be very careful going long. With the price level now within the kumo and yesterday break below the Kijun sen (trend line), the bearish signals seems to be coming together.


$SPX . Kumo support and possible reversal


SPX has been dropping over the last few days.

Mostly driven by negative news from Europe rather than the issues over at the Super Committee.

Despite, the drop and the light trading volume during the last 3 days, SPX bullish trend is still intact.

With about 1 month to go, and the SPX trading at 1160, it presents an opportunity to take a long position going into the year end.

From the Ichimoku Daily Chart, we can see

1. Despite the bearish cross from Tenkan sen and Kijun sen, SPX is still trading above the kumo which suggest bullish trend is intact.

2. For the trend to hold, we need the rebound to stay above 1183 going into December.

Beyond December, it is not clear if SPX will clear 1240. It may also fail to pierce through 1240 in the new year.