The Closing Print live trading and financial blog during market hours.

S&P500 Bullish Engulfing

The S&P500 reversed at support producing a bullish engulfing candle in the process. RSI is rising and MACD is producing shorter histogram bars signaling a potential bullish MACD cross in the next few days. Price action reversed at VBP support as well, noted along the blue horizontal line (histogram on the left).

SPX Bullish Engulfing

In addition, price action moved inside of standard deviation one Bollinger bands triggering a reversal signal to traders who use this strategy. Below is a screen cap taken LIVE during the session. Standard deviation one is noted in the blue shaded area.

On the left side of the chart, we see how this strategy signaled the reverse, a stop for longs when price action closed inside of standard deviation one the first week of February. Using this strategy would have told you to exit longs and again the process a shorting the market.

SPY daily Bullish engulfing

The sharp reversal produced a hammer on the weekly timeframe adding to the potential for a “W“ bottom. Should prices continue higher we can begin the process of building positions for the longer-term once again. Note the previous occasions in 2015 and 2016, which lead to rallies in the index. First target 2800.

SPX weekly bullish engulfing

Bullish Engulfing and Cycles

We used this chart, coupled with other indicators, as a guide to scaling out of winning positions into the January peak. The reverse in the cycle should lead to bullish follow-through. Now we need confirmation in the form of more buying. Use previous cycles to project duration of what appears to be a new uptrend.

SPX weekly CYCLE Bullish Engulfing

Focus on the stocks on the watch list this week, posted on the watchlist channel in the trading room. These should be considered first, in addition to previous watchlist candidates posted on the main site. Click on your account and navigate to “game plan“ for previous set up’s.

We will add to open positions, CNC, NI, SEDG, LGIH, and SPY common today. If SHY, IEF, UST, TLT, AGG start to weaken we might scale back in our bond “hedge” positions.

Trades will be considered “LIVE” during the morning broadcast as well.

Happy Thursday,


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