SPX: How to use the Principle of Polarity! + Trend analysis.
Hello traders and investors! Let’s see how the SPX is doing today!
In my last video, we talked about one of the most important principles that govern technical analysis, the Principle of Polarity. It is a must-know technique for any trader that states once a resistance (support) is defeated, it’ll become a support (resistance) in the future, next time the price retests it.
The 4,393 is working as a relevant support area, because it was a previous resistance (and previous ATH at the same time). It is also interesting to notice that when the index crashed on July 19, we sought the support area at 4,255, which was the previous resistance level too. Even during stressful times, it is possible to find some sense using price action.
For now, the index is behaving as we expected, the 21 ema is going up nicely, and it is another interesting support level for us. As we discussed, there’s a possibility of a Flag pattern too, but I’m not counting too much on that.
Now, some people might say, and I won’t disagree, that we have a possible Head & Shoulders chart pattern in the 1h chart. The problem is that today’s movement is ruining the pattern, and we are above the 21 ema again.
However, I agree that if we lose the 4,393 in the daily chart, along with the 4,369 in the daily chart, we might see a sharper pullback, but not a reversal. Let’s use Fibonacci in the daily chart:
Technically speaking, we could seek even the 61.8% retracement, and the mid-term bias would still be bullish. The index would require a true bearish structure to reverse for real, and as long as we don't see one, the trend will remain bullish. Meanwhile, I’ll update you with my weekly videos and analysis.
Remember to follow me to keep in touch with my daily studies, and if you liked this idea, please, support it!
Thank you very much!
In my last video, we talked about one of the most important principles that govern technical analysis, the Principle of Polarity. It is a must-know technique for any trader that states once a resistance (support) is defeated, it’ll become a support (resistance) in the future, next time the price retests it.
The 4,393 is working as a relevant support area, because it was a previous resistance (and previous ATH at the same time). It is also interesting to notice that when the index crashed on July 19, we sought the support area at 4,255, which was the previous resistance level too. Even during stressful times, it is possible to find some sense using price action.
For now, the index is behaving as we expected, the 21 ema is going up nicely, and it is another interesting support level for us. As we discussed, there’s a possibility of a Flag pattern too, but I’m not counting too much on that.
Now, some people might say, and I won’t disagree, that we have a possible Head & Shoulders chart pattern in the 1h chart. The problem is that today’s movement is ruining the pattern, and we are above the 21 ema again.
However, I agree that if we lose the 4,393 in the daily chart, along with the 4,369 in the daily chart, we might see a sharper pullback, but not a reversal. Let’s use Fibonacci in the daily chart:
Technically speaking, we could seek even the 61.8% retracement, and the mid-term bias would still be bullish. The index would require a true bearish structure to reverse for real, and as long as we don't see one, the trend will remain bullish. Meanwhile, I’ll update you with my weekly videos and analysis.
Remember to follow me to keep in touch with my daily studies, and if you liked this idea, please, support it!
Thank you very much!
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👉 Join the 5%: thefinancehydra.com/
💲💲 Project 5%: + 104%
🔹 S&P500: +35%
💪 Public track record.
