July 7, 2011

SPY Starting to Diverge

  • Negative divergence was updated yesterday in the below chart.
  • Today it showed its effect. if today's GAP does not fade we will see an Island reversal pattern
  • Price is starting to show negative divergence in smaller time frame charts
  • But price continue to make new high's which is the problem for bears.
  • Price was closer to the cloud yesterday But the hope of a correction vanished with today's GAP
  • If Negative divergence plays out today's GAP may get faded partially which will give a negative daily candle.

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