SPX - Bear market rally is in progress

Six days ago, we warned about the potential “bear market rally” in the SPX. Since then, the SPX has broken above the sloping resistance and gained 5%. Despite that, we still maintain a bearish notion of the U.S. stock market. We expect the bear market rally to be short-lived and weakness to return.

Illustration 1.01
The picture above shows the sloping resistance and breakout we warned about in our last post on SPX.

Technical analysis - daily time frame
RSI, Stochastics, and MACD are bullish. DM+ and DM seem to want to perform a bullish crossover; if successful, it could further bolster the bullish case. Overall, the daily time frame is bullish.

Technical analysis - weekly time frame
RSI is bullish; however, it did not break the bearish structure. MACD and Stochastics stay bearish. The same applies to DM+ and DM-. Overall, the weekly time frame remains bearish.

Please feel free to express your ideas and thoughts in the comment section.

DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not serve as a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.