Topping patterns on FTSE and S&P500

[pentothal]

I think it is important to signal that FTSE and S&P are forming topping patterns on the weekly chart.


Bottom line: monitor support levels closely because a break would mean that the cyclical (bullish) trend that started in 2011 has ended.




analysis


Both indices had weekly divergences with the respective MACD indicator for a while and have recently started to weaken.


The s&P shows a clear rising wedge formation (bearish reversal pattern) while the FTSE has a diamond/head and shoulder (bearish reversal as well).


What I’ve noticed looking at them on a daily basis, is that they have been so far unable to move above previous highs and we have now a sequence of lower highs and lower lows, either intraday (SPX) or on a daily basis (FTSE).


In both cases we have clear support levels which have not been broken yet: 6000 on the FTSE and 1600 on the S&P (see charts below).

FTSE100

S&P500

http://pentothalta.blogspot.co.uk/

 

[pfranz]

IMHO the FTSE100 long steady decline is quite impressive.

 

[pentothal]

An acceleration on the downside in the next couple of days would in my opinion signal a wave 3 of the first move down. Have to check the monthly chart before i can say more.
What do you think?

 

[pfranz]

I just see distribution so I'm waiting for an acceleration too, but don't have more precise ideas