Backtest and Fail

Yesterday went almost entirely according to plan. All the short term buy signals that fixed on Friday afternoon made target, and SPX tested the broken H&S neckline and the 50 hour MA at the high. Where SPX went off script was the close slightly above the daily middle band, which caused some technical damage that needs to be repaired by a decent close back below the middle band today. At the time of writing that looks likely. SPX 60min chart:

One caveat I would mention here though is the rising megaphone I've been showing on my ES chart below for a few days now. ES has been testing support there for an hour or so now and obviously further downside depends on that trendline breaking. I'm not a huge fan of correlations but I'd also note that ZB is testing clear bear flag channel resistance here at the same time. We'll see how that goes. Have I seen the bears totally blow better setups than this in the past? Many times, so I'm keeping an open mind. ES Jun 60min chart (from the pre-market subscriber charts at theartofchart.net)

If bears can break Friday's low then we should go lower and I've put the levels to watch next on the SPX chart. Today and tomorrow are both cycle trend days and that means that there are 70% odds that each day will be directional and dominated by either the bulls or the bears. That does not need to be a full trend day.

Stan and I are doing our public and free to all Chart Chat on Sunday at 4pm EST and if you enjoy good TA, or have any interest in the more likely price directions on a wide range of major trading instruments then you can sign up for that here. There are other trader education free webinars that we are doing listed there too so if you are interested in any of those then you can sign up for those there as well.

We have launched our upgraded website at theartofchart.net now and so far that has gone fairly smoothly so far. I'm doing my first post on the new blog there today looking at the Yen & will be posting the link to that on twitter (@shjackcharts) when I have finished that. That will be the first of a series of posts looking at major USD currency pairs.