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Price Action Trading – S&P 500 2 Bar Reversal | Jan 30th
Today, the S&P 500 has finally started to show major cracks in the uptrend from the latest ramp-a-thon courtesy of the Fed. On the daily chart, the pair formed a 2 Bar Reversal Pattern on the Daily time frame (chart below).
You will also notice in the chart above how the major index has levitated above the 20ema which is quite unusual for such a prolonged period of time.
The 4hr chart below shows the force of the selling, which is shaping up to be a counter-trend impulsive move. It is also the first time since Jan 17th the index has a) closed below the 20ema while b) breaking below the prior role reversal level. Thus, at best, I’m suspecting a lower top on any rallies, and will look for price action signals to sell around 1503, targeting 1495 and 1487.
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