Thursday, March 13, 2014 2:41:45 AM
John Murphy's Analysis of C Fund
S&P 500 UPTREND IS OVERBOUGHT
Although the trend in the S&P 500 is still up, some weekly indicators raise some short-term concerns. One is the fact that the 14-week RSI has touched overbought territory at 70 and is slighty lower than its fourth quarter peak. That potential "negative divergence" suggests that the uptrend is overextended. The weekly MACD lines overlaid the on the weekly prices are also at a critical spot f[color=red][/color]or the SPX. After turning down during January, two lines are still negative. As I suggested in a February message, for the uptrend in the S&P 500 to have staying power, the weekly MACD lines need to turn positive. The current position of two lines shows that an important technical test of the market's uptrend is taking place. A failure of the two weekly lines to cross would increase the odds for a market pullback. The green bars below the chart show the MACD histogram testing its zero line. The histogram needs a crossing above zero to reverse the negative signal given during January.
S&P 500 UPTREND IS OVERBOUGHT
Although the trend in the S&P 500 is still up, some weekly indicators raise some short-term concerns. One is the fact that the 14-week RSI has touched overbought territory at 70 and is slighty lower than its fourth quarter peak. That potential "negative divergence" suggests that the uptrend is overextended. The weekly MACD lines overlaid the on the weekly prices are also at a critical spot f[color=red][/color]or the SPX. After turning down during January, two lines are still negative. As I suggested in a February message, for the uptrend in the S&P 500 to have staying power, the weekly MACD lines need to turn positive. The current position of two lines shows that an important technical test of the market's uptrend is taking place. A failure of the two weekly lines to cross would increase the odds for a market pullback. The green bars below the chart show the MACD histogram testing its zero line. The histogram needs a crossing above zero to reverse the negative signal given during January.
Regards,
frenchee
#board-4258 TSP Trend Timing: EFA (I), AGG (F), SPY (C), and VXF (S)
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