SPX Showing Double Top Pattern

Financial Planner • May 18, 2017 at 11:47 AM EDT

The bull run of the S&P 500 Index, which started way back in early 2016, seems to be weakening. Why it's time to remain cautious on equity investments.

The bull run of the S&P 500 Index, which started way back in early 2016, seems to be weakening. The S&P 500 Index on weekly charts has made a "Double Top Pattern" or can be referred as "'M' Top Pattern". Oscillator RSI(14) has also made a lower high, confirming Bearish Divergence. (A bearish divergence occurs when prices keep making higher high and oscillator starts forming lower highs, indicating weakness in trend.)

If the S&P 500 index closes below 2350 this week, then the price can retest 2325 levels. Closing below the 2320 level will confirm the downtrend.

Time to remain cautious on equity investments.

(Click on image to enlarge)

Disclaimer:

The above views are only for educational purposes. Equity & commodity trading has large potential rewards, but also large potential risks. You must be aware of these risks and be willing to accept them in order to invest in the markets. Don't trade with money you can't afford to lose. This page is neither a solicitation nor an offer to acquire/sell any script. Please consult your financial advisor to take appropriate investments as per your risk profile. The past performance of any investments is not an indication for future returns.

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