This is a weekly bar chart of the S&P 500. Typically we provide analysis of the crypto market and tend to focus on low liquidity high volatility but the large indexes do provide a fair gauge of the overall market trend.
This chart is using the logarithmic scale and the circle tool divided into equal portions of 15 degrees to show the equalities in how momentum corresponds to both time and percentage change.
A regular chart that is only showing change in dollar amount does not provide the same data as the log. By using a log chart we are only looking at the percentage change in value.
As a speculator the change in dollar value is relatively insignificant; it is the change in percentage vs time that drives the psychology of buying and selling.
If a hundred dollar asset goes up by one dollar nobody cares but if a one dollar asset goes up by one dollar you have made a 100% return.
By using the circle tool divided into equal portions of time vs price we can see each time a 15 degree angle from the circle center crosses the circle it gives us a significant point in time and a separate significant price level. Price may or may not hit both the time and price at the same time and often occur separately but still mark a point to expect a notable reaction.
Simply take your cursor and it is clear that each point a 15 degree angle crosses the circle we have a significant top or bottom along with a respected price level.
Our current thoughts on the S&P is buyers and sellers are at a point of indecision. Without a new catalyst to rally buyers a sell off is likely to occur.
Thus we are looking for a break of the current uptrend and revisit the accumulation zone below.
Our current trading plan is to do nothing and wait for this possible retrace, establish a trend line of the retrace, and buy the breakout of the retrace trend IF it occurs.
We will also be looking to exit for a potential macro double top in stages at the levels and time periods provided by the momentum cycle on the chart.
This chart is using the logarithmic scale and the circle tool divided into equal portions of 15 degrees to show the equalities in how momentum corresponds to both time and percentage change.
A regular chart that is only showing change in dollar amount does not provide the same data as the log. By using a log chart we are only looking at the percentage change in value.
As a speculator the change in dollar value is relatively insignificant; it is the change in percentage vs time that drives the psychology of buying and selling.
If a hundred dollar asset goes up by one dollar nobody cares but if a one dollar asset goes up by one dollar you have made a 100% return.
By using the circle tool divided into equal portions of time vs price we can see each time a 15 degree angle from the circle center crosses the circle it gives us a significant point in time and a separate significant price level. Price may or may not hit both the time and price at the same time and often occur separately but still mark a point to expect a notable reaction.
Simply take your cursor and it is clear that each point a 15 degree angle crosses the circle we have a significant top or bottom along with a respected price level.
Our current thoughts on the S&P is buyers and sellers are at a point of indecision. Without a new catalyst to rally buyers a sell off is likely to occur.
Thus we are looking for a break of the current uptrend and revisit the accumulation zone below.
Our current trading plan is to do nothing and wait for this possible retrace, establish a trend line of the retrace, and buy the breakout of the retrace trend IF it occurs.
We will also be looking to exit for a potential macro double top in stages at the levels and time periods provided by the momentum cycle on the chart.
Comment:
either pausing or ready to reverse as it reaches the edge of the circle should see a trend change