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120419 WallstrM

Technical Update - Nasdaq 100 & S&P 500 could be forming Double Top patterns. VIX trying to built uptrend

Equities 3 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  Nasdaq 100/USNAS100 cfd and S&P 500/US500 cfd could be forming Double Top and reversal patterns. Indicator suggesting uptrends are weakening. Wait for confirmation.
VIX Volatility Index is close to be building uptrend

Nasdaq 100 has been once again rejected at key strong resistance at 15,265. The Index performed a higher close but RSI didn’t confirm that with a higher reading resulting in divergence i.e., a signal of a weakening of the uptrend.

Nasdaq 100 could be forming a Double Top pattern that is confirmed if a daily close below 14,687.
If that scenario plays out Nasdaq 100 could drop to support at around 13,982 as indicated by the vertical arrows.
However, a sell-off could be cut short at around 14,303.

However, the trend is still up and if Nasdaq 100 closes above 15,265 the uptrend is likely to be extended.

Nasdaq100 d 10jul
Source all charts and data: Saxo Group

USNAS100 cfd: RSI divergence. If Double Top pattern is confirmed which will occur if USNAS100 closes below 14,687 lower rising trendline is likely to be tested and USNAS100 could drop to 14K.
A close above 15,266 uptrend is to be extended

 

usnas100 d 10jul

S&P 500 showing RSI divergence is also forming what could be a Double Top pattern. A close below 4,328 will confirm that picture with down side potential to around 4,200.

A close above 4,459 will extend the uptrend with a likely move to strong resistance at around 4,546

sp500 d 10jul

US500 cfd: Double Top pattern confirmed if US500 closes below 4,327 with a potential target of around 4,200-4,165

us500 d 10jul

VIX Index has moved higher in an effort to build an uptrend. The Index did close higher but is being rejected at around 16.50
RSI is still showing negative sentiment.
But a VIX close above 16.50 could sent the Index up to around 19-20 level.

A close below 14.85 is likely to resulting in downtrend to resume

vix d 10jul

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